Episode 2: Introduction to Behavioral Finance - Part 1
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In this episode, we begin the Behavioral Finance course content with an introduction to Behavioral Finance, starting with a look at how we analyze our utility (read: happiness) and begin to discover how our real-life decisions often violate rational maximized "utility".
00:00 Introduction
04:37 Neoclassical Economics - 3 Assumptions of Fully Rational Participants
08:35 What is (Expected) Utility and How do We Calculate It?
10:30 Let's Make a Deal - St. Petersburg Paradox
20:30 Computing Expected Utility Using "LN" (Natural Logarithm)
24:15 First Violation of Expected Utility - 50/50 Coin Flip
29:12 Loss Aversion Defined & Your Loss Aversion Coefficient
I hope you enjoy the content and learn all about the topic of Behavioral Finance. I've set up the first few podcasts as mini lectures of my Behavioral Finance course that I teach at Butler University each semester. The goal of this podcast is to provide a comprehensive look into the topic of Behavioral Finance - for free!
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Bryan Foltice Behavioral Finance Website - www.bryanfoltice.com
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