The End of Behavioral Finance
CFA Institute
The End of Behavioral Finance Author(s): Richard H. Thaler Source: Financial Analysts Journal, Vol. 55, No. 6, Behavioral Finance (Nov. - Dec., 1999), pp. 12-17 Published by: CFA Institute Stable URL: http://www.jstor.org/stable/4480205 Accessed: 17/04/2009 10:10
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PERSPECTIVES
The
End
of
Behavioral
RichardH. Thaler
Finance
Tn 1985,WernerDe Bondt and I published an article that asked the question: "Does the stockmarketoverreact?" articlewas conThe troversialbecauseit gave evidence to support the hypothesis that a cognitive bias (investoroverreactionto a long seriesof bad news) could produce predictable mispricing of stocks traded on the NYSE.Although this idea was hardly
The End of Behavioral Finance Author(s): Richard H. Thaler Source: Financial Analysts Journal, Vol. 55, No. 6, Behavioral Finance (Nov. - Dec., 1999), pp. 12-17 Published by: CFA Institute Stable URL: http://www.jstor.org/stable/4480205 Accessed: 17/04/2009 10:10
Your use of the JSTOR archive indicates your acceptance of JSTOR 's Terms and Conditions of Use, available at http://www.jstor.org/page/info/about/policies/terms.jsp. JSTOR 's Terms and Conditions of Use provides, in part, that unless you have obtained prior permission, you may not download an entire issue of a journal or multiple copies of articles, and you may use content in the JSTOR archive only for your personal, non-commercial use. Please contact the publisher regarding any further use of this work. Publisher contact information may be obtained at http://www.jstor.org/action/showPublisher?publisherCode=cfa. Each copy of any part of a JSTOR transmission must contain the same copyright notice that appears on the screen or printed page of such transmission. JSTOR is a not-for-profit organization founded in 1995 to build trusted digital archives for scholarship. We work with the scholarly community to preserve their work and the materials they rely upon, and to build a common research platform that promotes the discovery and use of these resources. For more information about JSTOR, please contact support@jstor.org.
CFA Institute is collaborating with JSTOR to digitize, preserve and extend access to Financial Analysts Journal.
http://www.jstor.org
PERSPECTIVES
The
End
of
Behavioral
RichardH. Thaler
Finance
Tn 1985,WernerDe Bondt and I published an article that asked the question: "Does the stockmarketoverreact?" articlewas conThe troversialbecauseit gave evidence to support the hypothesis that a cognitive bias (investoroverreactionto a long seriesof bad news) could produce predictable mispricing of stocks traded on the NYSE.Although this idea was hardly
References: no. 5 (December):1541-78. Lintner, J. 1956. "Distributionof Incomes of Corporations among Dividends, Retained Earnings,and Taxes."American EconomicReview, vol S., Benartzi, R.Michaely,and R.H.Thaler.1997"DoChangesin vol. of Journal Finance, DividendsSignalthe Futureor the Past?" 52, no. 3 (July):1007-34. Bemard, V. 1992. "Stock Price Reactions to Earnings Announcements." In Advances in BehavioralFinance Russell, T., and R.H. Thaler. 1985. "The Relevance of in American Economic Quasi-Rationality CompetitiveMarkets." vol. Review, 75, no. 5 (December):1071-82. Shefrin, H. 1999. BeyondGreedand Fear:UnderstandingBehavioral Finance and the Psychology of Investing. Boston, MA: Harvard BusinessSchoolPress Shleifer, A. 1999. InefficientMarkets:An Introductionto Behavioral Finance. Oxford,U.K.:OxfordUniversityPress. Shleifer,A., and R. Vishny. 1997. "The Limits of Arbitrage." Journalof Finance,vol Stein, J. 1996. "RationalCapital Budgeting in an Irrational vol. World." Journal Business, 69, no. 4 (October):429-456. of November/December 1999