In Relation to Behavioural Finance,if an Investor Is Influenced to Follow

question 33

Multiple Choice

In relation to behavioural finance,if an investor is influenced to follow other investors into certain investment opportunities,this is called:

• A) trading noise.
• B) herding instinct.
• C) framing behaviour.
• D) disposition effect.

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Definitions:

Cognitive-Behaviorists

Professionals who specialize in cognitive-behavioral therapy, focusing on identifying and changing negative thought patterns and behaviors.

Downward Spiral

A progressively worsening situation where one negative event triggers another, leading to a continuous decline in circumstances or mood.

Social Rewards

Benefits that individuals receive from interacting with others, including acceptance, support, and validation.

Subgenual Cingulate

A brain structure whose abnormal activity has been linked to depression. Also called Brodmann Area 25.