Week 5 Flashcards
1
Q
what is efficient markets theory
A
assumes all investor beliefs are rational and follow bayesian probability
2
Q
what is bayesian probability
A
3
Q
what does the behavioural approach based on heuristics of judgment predict
A
over reaction to long term run of stock prices (losers gain, winners lose)
under reacted to news when the news has strong predictive values (losers lose, winners gain)
4
Q
A
