Behavioral finance Coursework Example | Topics and Well Written Essays - 1750 words

Behavioral finance - Coursework Example To establish the influence of cognitive, affective and social aspects on investment decision making, and the role of psychological and social factors in financial market behaviour, this essay discusses what might cause perceptions of risk to be inaccurate,. Risk is an amalgamation of the probability or frequency of occurrence of a distinct hazard and the magnitude of the consequences of the occurrence (Botterill & Mazur, 2004, p.1). It defines how often a particular harmful event is expected to occur and consequences that such an occurrence is expected to cause. In terms of investments, risk may be defined on the basis of the amount of loss expected to be incurred when an adverse occurrence happens or is expected to happen frequently. Therefore, perceptions of risk are constructed on the basis of individual beliefs, societal perceptions and expert perceptions. Most people perceive risk as a possibility of bad outcome, whenever a choice is made. Therefore, in many instances, risk taking is not regarded as a potentially positive activity. However, there are instances, though few, where risk taking is perceived as a positive activity, with the potential of creating benefits to an investor. There are significant gaps between perceived risk and measurable probabilities of risk. The evident widely acknowledged differences between perceived risk and actual risk suggests that in most cases; perceptions of risk are inaccurate. This is evident when significant differences are recorded in terms of what is perceived and what actually happens in terms of real investment risks (Botterill & Mazur, 2004, p.3). Therefore, various people understand and respond to risk in various ways, based on psychological and social factors surrounding them. One of the factors that influence perception of risk, and most probably leads to an inaccurate perception of risk is the

Staistics for Managers Final Project Term Paper

Staistics for Managers Final Project - Term Paper Example Marketing is one of the most important functions within the organizations and as a result, the data collected on the marketing tool needs to be inclusive and properly structured in order to gain from the marketing policies and mechanisms employed. Statistical data on marketing is essential for a company and should be well-tabulated to ensure that the data is used in the marketing research applications that the data is meant to improve. The company may conduct a survey on advertising and other marketing tools such as product promotion and measure the level of sales that has been influenced by the marketing tools (Balakrishnan, 2010). The company needs to conduct customer surveys and come up with the best structure and techniques in marketing that are not only attractive to the customers in the market but also offer a competitive advantage over the competitors (Balakrishnan, 2010). The methods employed by the company need to be assessed statistically to measure if they are working within the company and also measure if they have worked in other companies through their records. The analysis part is particularly simpler since the statistical data ensures that the information is properly structured and therefore easy to analyze. In marketing data forms a critical part of research where it provides the information crucial in determining the research area. Acquiring the right data needs the research to identify the data collection method critical in the research and that provides sufficient information regarding the subject under the study (Mazzocchi, 2008). Before discussing the data sources available, it is important that one understands that there are two types of data that is critical to the research. These are primary and secondary data. These two types of data are crucial in the research work and should be utilized for the perfection of the results. In addition, the two types of data helps in confirmation of the existing theory from the primary data