• Ms. Vishnu Priya B
• SHREYAS.SUMESH.MENON

Behavioral finance is a part of behavioral economics. They are based upon the theories of psychology on the behavior of an investor and their subsequent effect on the market. This is relatively a newer area of study. In behavioral finance investors are considered as normal rather than rational, they have limits for their self control, they are also influenced by their own biases due to which they make cognitive errors which ultimately leads to wrong decisions. The decision making errors can be broadly placed under four different categories namely self-deception, heuristic simplification, emotion, social influence. The self-deception deals with the way we learn, heuristic simplification can be said as the misinterpretation of the information. The two ways that can be adopted to protect against biased and decision making errors are focusing on the process under which comes both reflexive and reflective Former meaning going with your gut and later meaning going logically and methodically. Following the later ensures more effective decision making. And 3P’S Prepare, Plan, Pre-Commit.

Behavioral Economics, Psychology, Cognitive, Biases , Heuristic Simplification

"INVESTORS FINANCIAL BEHAVIORAL ", International Journal of Emerging Technologies and Innovative Research (www.jetir.org), ISSN:2349-5162, Vol.6, Issue 1, page no.219-222, January-2019, Available :http://www.jetir.org/papers/JETIR1901327.pdf

"INVESTORS FINANCIAL BEHAVIORAL ", International Journal of Emerging Technologies and Innovative Research (www.jetir.org | UGC and issn Approved), ISSN:2349-5162, Vol.6, Issue 1, page no. pp219-222, January-2019, Available at : http://www.jetir.org/papers/JETIR1901327.pdf