Edited by Brian Bruce
The journey to produce this book began in 1998 when The Institute of Psychology and Markets was founded to study the impact of psychology on investor decision making. As the new century approached, the understanding of markets was moving beyond the perception that financial market participants are perfectly rational. The Institute was founded on the belief that new research would explore important dynamic processes previously ignored by traditional finance. The Institute was interested in studying ways in which psychology played a role in understanding how financial markets function. The goal was to address issues surrounding the integration of many disciplines into the field of investing including social psychology, group psychology, psychiatry, organizational behavior, accounting, marketing, sociology, anthropology, behavioral economics, finance and decision making. This initial meeting, held in Aspen, Colorado in December 1998, was limited to 25 participants and included some of the most important minds in the study of behavioral finance. The Advisory Board of the Institute consisted of a diverse group of psychiatrists, psychologists, economists and market practitioners. They included: Professor Brian Bruce, Department of Finance, Southern Methodist University Mr David Dreman, Chairman of Dreman Value Advisors Dr Richard A. Geist, affiliated with the Harvard Medical School Dr Peter Neubauer, Clinical Professor of Psychiatry, New York University and Chairman Emeritus, Columbia University, Center for Psychoanalytic Training and Research Professor Robert Olson, Department of Finance, California State University, Chico Professor Fred Renwick, Department of Finance, New York University Dr John W. Schott, affiliated with the Harvard Medical School Professor...