A Behavioral Approach to Asset Pricing

<p>1. Introduction</p> <p>I Heuristics and Representativeness: Experimental Evidence2. Representativeness and Bayes Rule: Psychological Perspective 3. Representativeness and Bayes Rule: Economics Perspective 4. A Simple Asset Pricing Model Featuring Representativeness 5. Heterogeneous Judgements in Experiments </p> <p>II Heuristics and Representativeness: Investor Expectations6. Representativeness and Heterogeneous Beliefs Among Individual Investors, Financial Executives, and Academics 7. Representativeness and Heterogeneity in the Judgements of Professional Investors </p> <p>III Developing Behavioral Asset Pricing Models8. A Simple Asset Pricing Model with Heterogeneous Beliefs 9. Heterogeneous Beliefs and Inefficient Markets 10. A Simple Market Model of Prices and Trading Volume 11. Efficiency and Entropy: Long-run Dynamics </p> <p>IV Heterogeneity in Risk Tolerance and Time Discounting12. CRRA and CARA Utility Functions 13. Heterogeneous Risk Tolerance and Time Preference 14. Representative Investors in a Heterogeneous CRRA Model</p> <p>IV Sentiment and Behavioral SDF 15. Sentiment 16. Behavioral SDF and the Sentiment Premium </p> <p>VI Applications and Behavioral SDF17. Behavioral Betas and Mean-Variance Portfolios 18. Cross-section of Return Expectations 19. Testing for a Sentiment Premium 20. A Behavioral Approach to the Term Structure of Interest Rates 21. Behavioral Black-Scholes 22. Irrational Exuberance and Option Smiles 23. Empirical Evidence in Support of Behavioral SDF </p> <p>VII Prospect Theory24. Prospect Theory: Introduction 25. Behavioral Portfolios 26. Equilibrium with Behavioral Preferences27. Pricing and Prospect Theory: Empirical Studies 28. Reflections on the Equity Premium Puzzle 29. Continuous Time Behavioral Equilibrium Models30. Conclusion</p>