Efficient Capital Market - C

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Across
  1. 8. Market Analysis / It is a must do a superior job of estimating the relevant variables that cause the long-run movements.
  2. 9. / It focuses on the individual behaviour.
  3. 11. Analysis / The assumptions of this analysis directly oppose the notion of efficient markets.
  4. 12. Bias / It causes investors to put more money into bad investments or failures.
  5. 13. Bias / People have a tendency to ascribe any success to their own talents while blaming any failure on “bad luck” which causes them to overestimate their talent.
  6. 15. / Individuals who are asked to estimate something, start with initial arbitrary (casual) value then adjust away from it. The problem with this is that the adjustment is often insufficient.
  7. 17. / It is the anatomy, mechanics and functioning of the brain.
  8. 18. Funds / Are security portfolios designed to duplicate the composition, and performance, of a selected market index series.
Down
  1. 1. Bias / A tendency after an event for an individual to believe that they can predict better than they can.
  2. 2. Theory / Contends that utility depends on deviations from moving reference point rather than absolute wealth.
  3. 3. / It detects the beginning of a movement to a new equilibrium.
  4. 4. Analysis / Involves aggregate market analysis, industry analysis, company analysis, and portfolio management.
  5. 5. Perseverance / Once people have formed an opinion (on a company or stock) they cling to it too tightly and for too long.
  6. 6. Bias / Investors look for information that supports their prior opinions and decisions.
  7. 7. / Analysts and investors suffer from this and it causes them to believe that the stocks of growth companies will be “good” stocks.
  8. 10. Stock / Its market price exceeds intrinsic value.
  9. 13. Psychology / It is the study of how we behave and make decisions in the presence of others.
  10. 14. / It causes analysts to overestimate the rates of growth and its duration for growth companies and overemphasize good news and ignore negative news for these firms.
  11. 16. Finance / It considers how various psychological traits affect how individuals or groups act as investors, analysts, and portfolio manager.
  12. 17. Traders / It is strongly influenced by sentiment, tend to move together, which increases the prices and volatility of securities