UCL School of Management

Module Fact Sheet

MSIN0112: Behavioural Finance

Taught by
Level
Masters, level 7
Prerequisites
None
Eligibility
MSc Finance students only
Terms
3
Delivery method
3-hour lecture (x 5 weeks)
Assessment
Online exam  20%
Group coursework 80%
Previous Module Code
MSING073

Course overview

The field of Behavioural Finance examines the way psychological factors affect financial behaviour. Rooted in psychology and finance, it demonstrates that human emotions, such as fear, and limited cognitive resources, including finite attention, have central roles in shaping the financial markets.  The module introduces students to the psychological and financial foundations of behavioural finance. It explores central theories in behavioural finance and emotional finance. Applications for financial decision-making, legislation and ethics are discussed. Research methods in behavioural finance are explained.

Learning outcomes

  • Understand central behavioural finance theories and their applications.
  • Recognise the way psychological factors influence financial decision making
  • Be familiar with research methods used in behavioural science.
  • Be able to perform research on behavioural science.

Topics covered

  • Financial psychology: Social psychology, cognitive psychology and physiological psychology 
  • Foundations of behaviour: Challenging the classical assumptions of finance
  • Central behavioural finance effects 
  • Emotional finance
  • The new frontiers of behavioural finance: Evolutionary finance and the adaptive market hypothesis

Assessment summary

Online exam  20% Group coursework 80%

Current students should refer to Moodle for specific details of the current year’s assessment.

Essential reading

Suggested reading

·        Mauboussin, Michael J. 2012.  “Think Twice: Harnessing the Power of Counter Intuition” Harvard Business Review Press

·        Burton, E., Shah, S., “Behavioural Finance: Understanding the Social, Cognitive and Economic Debates” 2013. Wiley.

Past versions of this module

MSIN0112 18/19

MSING073 17/18

Last updated Monday, 15 July 2019