Guest Lecture on ‘Behavioral Finance & Investment Decisions: Exploring The Relationship’

The BBA(Financial Services) Department of the College organized a Guest lecture on the topic Behavioral Finance & Investment Decisions: Exploring The Relationship on 11^th November 2020 from 12:00 to 1:00 pm using the Google Meet Platform. The Resource person for the session was CA Kamlesh Kanji, ex-student of the College and an active stock market trader since 2005.

1. Kamlesh began the session by introducing the Concept of Behavioral finance as against Efficient Market Theory. He focused more on the investment side of behavioral finance. He mentioned that investment decisions based on investors’ psychology affect market outcomes. Investors are emotional and not rational. Investment decisions taken in an emotional environment can prove to be dangerous as the stock market does not give a chance to reverse the decisions. Behavioral finance teaches us to understand the different psychological biases. He focused on Herd behavior, where Investors follow the crowd. They take investment decisions by copying the behavior of other investors, ignoring all fundamental and technical analysis. He mentioned that one should not take investment decisions in greed and fear. He added that Investors like Warren Buffet and Benjamin Graham are successful today not because they have high IQ but because they have control over their emotions.
2. Kamlesh ended the session, stating that there is no particular formula or a ratio to make money in the stock market. Every investor will have an advantage provided he is emotionally resilient and capable of overcoming fear when the market collapses and controlling his greed. The session covered lot of practical examples taking into consideration the 2008 financial crisis and how being patient and emotionally strong during this biggest market crash could have added to the wealth of investors. CA. Kamlesh also shared his experiences of trading in the stock market.

80 students attended the session, which was in a very novel area for them. They found the session interesting and enjoyed a lively interaction with the Resource Person.