Short Learning Programme in Behavioural Finance

Behavioural finance, a relatively new field of study, is the study of the influence of psychology on the behaviour of markets, individuals and companies.
It focuses on the fact that people are not always rational in their economic decisions, have limits to their self-control, and are influenced by their own biases.

Although various international offerings are available, no comparable short course offering on behavioural finance could be found in South Africa.
Various finance professionals have expressed a need to understand behavioural finance concepts better.

Purpose of the course

This first-of-its-kind course in South Africa aims to equip finance professionals (such as accountants, financial managers, financial advisors) with knowledge and skills to:
• Understand the role of behavioural finance in traditional economic and finance theory.
• Identify, describe and mitigate cognitive and emotional biases.
• Understand the potential impact of behavioural biases for individuals, corporations and markets as a whole.
• Improve financial decision-making.

Admission requirements

The participant must be able to communicate in the language of instruction and have completed some form of post-National Senior Certificate at NQF level 4 qualification, preferably a BCom degree.

Learning assumed to be in place

• Communication at NQF level 4.
• Computer literate at NQF level 4.
• Mathematical literacy the NQF level 4.

Course outcomes and assessment criteria

Course outcomes and the associated assessment criteria

Outcomes	Assessment Criteria
After completion of this course, participants will have:	The participant will be assessed on the following criteria:
Detailed knowledge and clear understanding of what behavioural finance is. Detailed knowledge and clear understanding of the types of behavioural finance. Detailed knowledge and clear understanding of what developments brought us from traditional economic and finance theory to behavioural finance. Detailed knowledge and clear understanding of the most prominent behavioural finance researchers.	Explain what behavioural finance is. Identify the types of behavioural finance. Discuss the development from traditional economic and finance theory to behavioural finance. Identify the most prominent behavioural finance researchers.
Detailed knowledge and clear understanding of how humans behave financially. Understand the utility curve and loss aversion in investors. Detailed knowledge and clear understanding of the role of portfolio theory. Detailed knowledge and clear understanding of the role agency theory plays in decision-making. Detailed knowledge and clear understanding of efficient market hypothesis and the anomalies we notice. Detailed knowledge and clear understanding of the principles behind prospect theory.	Identify and explain the impact of utility, portfolio theory, agency theory, efficient market hypothesis, and prospect theory on how humans behave financially.
Insight into how humans think. Insight into what a bias is. Clear understanding of the different kinds of biases.	Explain how humans think. Define a bias. Describe the different kinds of biases.
Detailed knowledge and clear understanding of belief perseverance and cognitive dissonance as a group of cognitive biases. Detailed knowledge and clear understanding of emotional biases. The ability to (1) describe the biases (2) identify the biases, and (3) advise on how to address these biases.	Distinguish between belief perseverance and cognitive dissonance as a group of cognitive biases as well as emotional biases. Describe the various biases. Identify the biases. Advise on how to address the biases.
The ability to effectively apply knowledge of behavioural finance in the life of individuals. The ability to effectively apply knowledge of behavioural finance in the corporate environment. Detailed knowledge and clear understanding of the historical impact of behavioural finance on markets.	Apply their knowledge of behavioural finance in the life of individuals. Apply their knowledge of behavioural finance in the corporate environment. Describe the historical impact of behavioural finance on markets.