Sun, Nov 29, 2015
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications

Expertise on investing in "falling knives"

Tuesday, March 27, 2007
Björn Englund shares his experiences on catching “ falling knives” (investing in out of favour S&P stocks) using behavioural finance insights.

A SQUARE :: 27Mar07 Expertise on investing in "falling knives"
Category Behavioural Finance
Faculty Bjorn Englund
Expertise Behavioural Finance - Falling Knives
Author Sona Blessing
Faculty Name
How has behavioural finance helped you catch “falling knives” (out of favour S&P stocks)?

While the hypothesis of an efficient market is widely embraced, it fails to explain some recurring investment anomalies that do exist. These anomalies can be explained by behavioural finance theories,
which concede that some other factors are at play (some irrational - some rational). As human
beings we tend to behave irrationally when we experience stress, fear, when we are emotionally charged etc. We also need to rationalise and hence tend to find comfort in known, recognised behaviour patterns such as following the rule of thumb; seek loss minimisation, move in herds etc.

Download this research The many benefits of an A SQUARE subscription Recommend to a friend

<< A SQUARE archive sorted by date    << A SQUARE archive sorted by category

 Article link
More research related to Behavioural Finance

[11Dec08] [Behavioural Finance] A behavioural finance fund
Statistical analysis is used to determine whether recent price action is consistent with investor or speculative market participants


[05Jun08] [Behavioural Finance] Neural Network Investing
Can human beings ever trade like systematic, emotion-free, systems?


[03Oct07] [Behavioural Finance] Exploring the cultural impact on investing ... expertise with Mei Wang
An interesting reflection of this behaviour can be observed in choosing health insurances. Together with Paul Fishbeck (Carnegie Mellon University), I found that framing has a bearing and influences health insurance decisions of Chinese subjects, but not


[26Sep07] [Behavioural Finance] JP Morgan Undiscovered Managers Behavioral Growth Fund (Institutional Class)
Exploiting the mental mistakes investors make - (that may cause the market to underreact to new, positive information concerning a company)


[10May07] [Behavioural Finance] Osiris Equities EMU Behavioural Value
The fund is unique because it has managed to apply and convert behavioural finance concepts into behavioural investing


[13Feb07] [Behavioural Finance] LGT Equity Funds Global Sector Trends
A fund that uses a behavioural finance approach in portfolio allocation

Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Other Voices: Hedge fund marketing and the selling cycle[more]

    By Bruce Frumerman. How long is the selling cycle now? That’s a question my financial communications and sales marketing consulting firm has been asked on a regular basis by hedge fund firm owners and sales people, ever since we opened the doors to our firm in 1987 pre-crash. Wa

  2. People - Solus Alternative Asset Management adds chief strategist from BTIG[more]

    From Daniel Greenhaus joined hedge fund manager Solus Alternative Asset Management as managing director and chief strategist. He will work closely with Chris Bondy, Solus’ chief economist, managing director and executive vice president, said Chris Pucillo, CEO and chief investmen

  3. Opalesque Roundtable: Seeding deal terms can be onerous for hedge funds[more]

    Benedicte Gravrand, Opalesque Geneva for New Managers: Executives from fund of funds firms, family offices, a placement agent, a private equity firm, and an accounting firm gathered in Connecticut last month for the

  4. Opalesque Roundtable: Family offices flock to co-investment[more]

    Bailey McCann, Opalesque New York: Co-investments have been a hot topic for pension funds in recent years, as they try to move away from high fees and improve transparency. But now, family offices are more readily getting into the mix and establishing in-house deal teams, according to the delega

  5. More institutional investors invest in CTAs compared to last year despite dissatisfaction with performance[more]

    Benedicte Gravrand, Opalesque Geneva: "Despite a strong start to 2015 for CTAs in Q1, commodity market conditions have made return generation difficult for fund managers over much of the rest of the year to date," says Preqin’s November