Calicut University • BBA • Semester 5
Behavioural Finance — Course Syllabus
Course Code: BBA5CJ302 • Four-Year Undergraduate Programme (FYUGP)
Module I: Introduction to Behavioral Finance
- Unit 1: Nature, Scope, and Foundations of Behavioral Finance vs Traditional Finance.
- Unit 2: Standard Finance Assumptions – Rationality, Expected Utility Theory, EMH.
- Unit 3: Prospect Theory (Kahneman & Tversky) – Loss Aversion, Value Function.
- Unit 4: Mental Accounting, Framing Effects, Disposition Effect.
Module II: Cognitive Biases & Limits to Arbitrage
- Unit 5: Heuristics & Biases – Overconfidence, Representativeness, Availability, Anchoring.
- Unit 6: Emotional Biases – Regret Aversion, Endowment Effect, Status Quo Bias.
- Unit 7: Limits to Arbitrage – Fundamental Risk, Noise Trader Risk, Implementation Costs.
- Unit 8: De Long, Shleifer, Summers, and Waldmann (DSSW) Noise Trader Model.
Module III: Market Anomalies & Investor Sentiment
- Unit 9: Ambiguity Aversion & Ellsberg Paradox in Financial Decision Making.
- Unit 10: Bounded Rationality (Herbert Simon) and Satisficing Behavior.
- Unit 11: Investor Sentiment Metrics, Market Bubbles, and Herd Behavior.
- Unit 12: Market Anomalies – Calendar Anomalies (January Effect), Momentum, Value Anomaly.
Module IV: Behavioral Corporate Finance & Neurofinance
- Unit 13: Managerial Biases in Corporate Capital Budgeting and M&A Decisions.
- Unit 14: Volatility Index (VIX), Fear & Greed Index, Investor Sentiment Measurement.
- Unit 15: Seasonal Affective Disorder (SAD) & Exogenous Factors on Asset Prices.
- Unit 16: Behavioral Nudges in Wealth Management & Neurofinance Overview.
BBA5CJ302Behavioral Finance
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Calicut University • FYUGP 2024 Syllabus
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