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Can Financial Education Extend the Border of Bounded Rationality?
2016
Modern Economy
When choosing a particular alternative from a number of financial assets, risk is an important feature. According to the classic Capital Assets Pricing Model (CAPM), we would expect to receive a positive correlation between risk and return of financial assets. However, studies show that investors judge financial assets in terms of "good" or "bad". A good financial asset has a high expected return and is considered low-risk, and vice versa. This type of thinking is biased, as it is both
doi:10.4236/me.2016.72012
fatcat:qeyidrnvjfdhxn2sdikac65prm