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Does training on behavioral finance influence fund managers' perception and behavior?

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  • Nikiforow, Marina

Abstract

This paper provides survey evidence on the influence of training on behavioral finance on professional fund managers' perception and investment behavior. In particular, it examines whether "trained" fund managers differ from the "untrained" ones in their perception of markets and themselves as well as in their choice of information sources and investment strategies. Additionally, the influence of integration of behavioral finance approaches into investment processes is also considered. The results reveal that training on behavioral finance basically intensifies the perception of biases in the behavior of others, i.e. the reflection effect and the home bias. Training also reduces the affinity to conformity, leading to less reliance on colleagues and other market participants as information sources. However, pure training is insufficient to significantly affect fund managers' investment behavior, but behavioral finance approaches need to be integrated into investment processes.

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Bibliographic Info

Paper provided by Leibniz Universität Hannover, Wirtschaftswissenschaftliche Fakultät in its series Hannover Economic Papers (HEP) with number dp-419.

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Length: 28 pages
Date of creation: Jun 2009
Date of revision:
Handle: RePEc:han:dpaper:dp-419

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Keywords: behavioral finance; fund managers; biases; training; integration;

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