An Investigation the “Flash Crash” of 2010 using the principles of behavioral finance

An Investigation the “Flash Crash” of 2010 using the principles of behavioral finance

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In every market there are some trading or buying anomalies that cannot be explained by financial instruments and theories alone. For this reason the field of behavioral finance was developed. As investors are humans, they sometimes act in according to their instinct rather than strict financial rules, principals or inputs. There have been many events in the last century that do not have a clear financial explanation but rather seem more possibly explained by psychological factors. One of the most recent events that has been witness to this financial anomaly is the a€œFlash Crash of 2010a€. This research will look into the event as well as examine how behavioral finance theories can be used to create a rational explanation to this seemingly irrational event.Using behavioral finance as a background to understanding investor behavior, this paper will explore non-financial ... of the paper After this brief introduction, which has introduced the topics to be covered, this paper will cover the research anbsp;...


Title:An Investigation the “Flash Crash” of 2010 using the principles of behavioral finance
Author:Jovana Paraca
Publisher:GRIN Verlag - 2014-03-10
ISBN-13:

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