FIN 3617 Behavioural Finance

FIN 3617 Behavioural Finance

Course code: 
FIN 3617
Department: 
Finance
Credits: 
7.5
Course coordinator: 
Ellen T. Saskia
Dagfinn Rime
Course name in Norwegian: 
Behavioural Finance
Product category: 
Bachelor
Portfolio: 
Bachelor of Finance - Programme Courses
Semester: 
2023 Spring
Active status: 
Active
Level of study: 
Bachelor
Teaching language: 
English
Course type: 
One semester
Introduction

For a very long time, the field of finance has been dominated by a successful paradigm based on the notions that investors and managers are rational and that the market is efficient. In recent decades, however, anecdotal evidence as well as theoretical and empirical research has shown this paradigm to be insufficient to describe various features of actual financial markets. In this course, we explain financial market phenomena by incorporating institutional, social, cognitive, and emotional biases to the traditional paradigm. This broader perspective is called behavioural finance.

The objective of this course is to give students an understanding of investor and managerial behaviour and its impact on financial market outcomes. The participants should be able to identify most common obstacles to making rational decisions, to debias their own decisions, and to understand the risks and opportunities associated with biased decisions. The course spans all major fields of finance, including household finance, asset pricing, and corporate finance. It also relates to an emerging field of sustainable finance through the social preferences investors may have and how those affect investment decisions.

Learning outcomes - Knowledge

Students will acquire an understanding of the following topics:

  • How do people make investment decisions?
  • How does investor behaviour affect asset prices?
  • How do firms respond to investor behavior?

 

Learning outcomes - Skills
  • Recognize behavioral biases in decision making
  • Identify implications for asset pricing
  • Understand effects on corporate behaviour
  • Clearly and effectively communicate advice based on the skills and knowledge learned
General Competence
  • The student develops a behavioural framework that can be applied across a variety of financial domains.
Course content
  • How does behavioural finance differ from non-behavioural finance?
  • How does behavioural finance help us to understand investor behaviour?
  • What are the implications of investor behaviour for asset prices?
  • How does investor behaviour influence corporate decision-making?
Teaching and learning activities

The course includes a combination of lectures and assignments.

Specific information regarding any aspect of the course or student evaluation will be provided in class. It is the student's responsibility to obtain any information provided in class that is not included on the course page (It's Learning) or in the reading materials.

Students will be expected to actively participate in all in-class discussions (related to assignments, course concepts, applications of behavioural finance in the industry, etc.). 

Spreadsheets (Excel) may be used for certain practical applications and examples. Students should be familiar with their use.

This is a course with continuous assessment (several exam components) and one final exam code. Each exam component is graded by using points on a scale from 0-100. The components will be weighted together according to the information below in order to calculate the final letter grade for the examination code (course). Students who fail to participate in one/some/all exam elements will get a lower grade or may fail the course. You will find detailed information about the point system and the cut off points with reference to the letter grades when the course start.

At re-sit all exam components must, as a main rule, be retaken during next scheduled course.

Software tools
Software defined under the section "Teaching and learning activities".
Qualifications

Higher Education Entrance Qualification

Disclaimer

Deviations in teaching and exams may occur if external conditions or unforeseen events call for this.

Required prerequisite knowledge

SØK 3520 Microeconomics or EXC 3520 Microeconomics and BØK 3423 Finance, or equivalent.

Exam categoryWeightInvigilationDurationSupport materialsGroupingComment exam
Exam category:
Submission
Form of assessment:
Written submission
Exam code:
FIN36171
Grading scale:
Point scale leading to ECTS letter grade
Grading rules:
Internal and external examiner
Resit:
All components must, as a main rule, be retaken during next scheduled course
30No3 Week(s)Group ( 1 - 4)This component is a multimedia assignment.
Exam category:
Submission
Form of assessment:
Written submission
Exam code:
FIN36171
Grading scale:
Point scale leading to ECTS letter grade
Grading rules:
Internal and external examiner
Resit:
All components must, as a main rule, be retaken during next scheduled course
70Yes3 Hour(s)
  • No support materials
Individual This component consists of a number of hand-ins that are submitted throughout the semester.
Exams:
Exam category:Submission
Form of assessment:Written submission
Weight:30
Invigilation:No
Grouping (size):Group (1-4)
Support materials:
Duration:3 Week(s)
Comment:This component is a multimedia assignment.
Exam code: FIN36171
Grading scale:Point scale leading to ECTS letter grade
Resit:All components must, as a main rule, be retaken during next scheduled course
Exam category:Submission
Form of assessment:Written submission
Weight:70
Invigilation:Yes
Grouping (size):Individual
Support materials:
  • No support materials
Duration:3 Hour(s)
Comment:This component consists of a number of hand-ins that are submitted throughout the semester.
Exam code: FIN36171
Grading scale:Point scale leading to ECTS letter grade
Resit:All components must, as a main rule, be retaken during next scheduled course
Type of Assessment: 
Continuous assessment
Grading scale: 
ECTS
Total weight: 
100
Student workload
ActivityDurationComment
Teaching
42 Hour(s)
Prepare for teaching
78 Hour(s)
Group work / Assignments
40 Hour(s)
Student's own work with learning resources
40 Hour(s)
Preparation for the final exam.
Sum workload: 
200

A course of 1 ECTS credit corresponds to a workload of 26-30 hours. Therefore a course of 7,5 ECTS credit corresponds to a workload of at least 200 hours.