Episode 11: How Biases and Heuristics Cause Financial Decision-Making Errors

In this four and final podcast on heuristics and biases, we connect the previously learned biases and heuristics of the last three episodes to our financial decision making. 

01:47 Heuristics Review  
03:05 Diversification Heuristic (Naive Diversification)
11:16 Information Overload on Retirement Investment Decisions 
13:52 Ambiguity in Investment Decisions (Under-diversification)
14:45 Home Bias Overview
16:50 Why the Home Bias Exists (3 Reasons)
20:21 Next Level Home Bias (Regional and Localized Home Bias)
23:10 Hedging our Happiness
25:05 Other Factors Driving Home Bias
26:20 Anchoring and Adjustment in Real Estate Appraisals
28:35 Status Quo Bias and Our Asset Allocation Decisions
33:20 Myopia and Frequently Feeling Losses in Our Portfolio 

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!

#behavioralfinance #psychologyofmoney #financialdecisions 

References: Bernartzi and Thaler (2001) - Naive Diversification
https://www.aeaweb.org/articles?id=10.1257/aer.91.1.79

Disclaimer: www.bryanfoltice.com/cv