Behavioral Finance and Decision Theory in Investment Management

this book was recommended to me by teresa lo's financial blog. it's a collection of several articles by economists, psychologists, and financial gurus about how investment managers don't behave the way the classical laws of economics say they should. while the articles are a bit scholarly, they get right to several key problems in decision making, and pitfalls investors need to avoid. it's a conference proceedings, so it has a bit of that academic je ne sais quoi. i recommend a strong cup of coffee while reading rather than a bedtime read. what you take from the story is that it is more important to pay attention to what the herd is doing and try to take advantage of its predilections rather than follow any system. there are lots of facts and figures. the last article by woody brock is the simplest and clearest in my view. i think you have to be into the behavioral economics thing, as well as being an investor, to want this volume, but it is a good survey of the current state (as of pub date) in a fast moving field.