The Herd Behavior of Risk-Averse Investor Based on Information Cost

DOI: 10.4236/jfrm.2013.24015   PDF   HTML     4,882 Downloads   8,804 Views   Citations

Abstract

In this paper, the traditional model of herd behavior was improved and extended. The herd behavior of risk-averse investor based on information cost was studied in the financial market. By refining the concept of Bayes equilibrium and the analysis of the behavior of investors, it was discovered that the herd behavior of the second risk-averse investor did not produce until the first risk-averse investors chose to buy information.

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Deng, G. (2013). The Herd Behavior of Risk-Averse Investor Based on Information Cost. Journal of Financial Risk Management, 2, 87-91. doi: 10.4236/jfrm.2013.24015.

Conflicts of Interest

The authors declare no conflicts of interest.

References

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