NEUROECONOMICS AND INVESTMENT DECISIONS. PARADOXES OF MODERN STOCK EXCHANGE MARKETS
NEUROECONOMICS AND INVESTMENT DECISIONS. PARADOXES OF MODERN STOCK EXCHANGE MARKETS

Summary/Abstract: Capital market investments have caused at least in the last two decades, a great interest from investors, because of their ability to generate high returns. Unfortunately, this kind of investments can generate large losses as well. Since 90’s, the scientists have approached a new area of research, called neuroeconomics which has the object of study the investors risk perception, quantification and probability determination of risk. Neuroeconomics as a recent research area, is situated at the intersection of psychology with economics, equation in which is involved also a branch of medicine, neurology. One of the few specialists in this field, Jason Zweig believes that neuroeconomics applied to financial sector, has a great practical interest to understand the decisions of the actors in the market. Numerous theories on decisions to invest on capital market are put in difficulty, if we are looking from the perspective of neuroeconomics. This is because the decisions that investors take are very often irrational and inconsistent with these theories. Such irrational behavior of investors may be generated by their personality, emotions, temper with their feelings. This paper continues the series of some analysis on the investment decision in modern stock market, characterized equally by opportunities and risks consciously assumed.

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