Investment Decisions in Financial Market
and Behavioural Finance

Managers and directors responsible for managing client assets are obliged to have a good understanding of the factors that potentially lead to sub-optimal outcomes for investors because of today’s ever-changing and complex financial markets. Fund managers are consistently facing problems when constructing portfolios for their clients or organization and this is because of their varying risk appetites.

Investment Decisions in Financial Market and Behavioral Finance training course presents a revolutionary new insight into decision making process and the surrounding psychology under conditions of risk and uncertainty. This training course focuses on practical applications of the traditional investment decisions and psychological bias associated with the decision-making process. It highlights how individuals psychological bias affect the outcome of the investment decisions. Participants of this training course will gain a good knowledge of the effect of psychological bias and how to overcome common these biases when making investment decisions. Participants will be able to identify the psychological reasons that lead investors or managers to make severe investment errors.

This Investment Decisions in Financial Market and Behavioral Finance training course will highlight:

• An insight of various sources of funds available to the business
• The common pitfalls of making financing decisions that adversely affect the success of the companies
• The common tools and techniques used in dealing with volatile market condition
• What are the common and suitable techniques for minimizing the risk without sacrificing the performance
• How neoclassical finance compared to behavioral finance
• The consequences of behavioral biases to the company performance
• The popularity of behavioral finance relative to traditional finance

The seminar is split into two modules:

MODULE I - Essentials of Corporate Finance

MODULE II - Behavioural Finance

Each module is structured and can be taken as a stand-alone training course; however, delegates will maximise their benefits by taking Module 1 and 2 back-to-back as a two-week training course.

By the end of this training course, the participants will develop knowledge and skills in both traditional and behavioral finance, enabling them to: 

• To contribute effectively to the strategic decisions
• Evaluate the most efficient finance options available
• Avoid psychological biases when  making decisions in a competitive environment
• Identify the behavioral biases that present obstacles to maximise firms value
• Learn how both individual financial decisions making, and behaviour bias affect investment outcomes
• Demonstrate the ability to overcome behavioral biases such as heuristics and framing effects corporate financial and investment decisions

This Investment Decision in Financial Market and Behavioral Finance training course will be conducted along workshop principles, which includes the use of case studies and worked examples. The participants will be encouraged to actively engage as part of a group, in the analysis and evaluation of case studies. Relevant examples and empirical studies will be used to illustrate the application of each of the topics covered and their application in the key investment strategies.

This Investment Decisions in Financial Market and Behavioral Finance training course is very interactive, and the organization will benefit the following: 

• The ability to analyse various business problems within the organization
• How to evaluate various alternative decisions and make sound recommendations
• New techniques to make more informed and better management decisions
• Applying various financial skills and analysis in the workstation
• How psychology compares to neuroscience of financial decision making
• How to overcome market sentiment when making decision under uncertainty
• Critical analysis and interpretation of financial innovations and risks
• Ability to construct a winning portfolio

The impact of this training course to the participants are manifold and includes:

• Ability to make better financial decisions using various models.
• Enhanced financial and decision-making skills
• How to assess techniques used by the company and propose alternatives methods
• The ability to use behavioral models for making business decision
• The opportunity to correct mistakes based on behavioral biases
• The knowledge of dealing with common behavioral biases
• Insight into how the financial market operates
• How to make efficient financial decisions in a volatile market
• Assessing the current market trend
• A good understanding of financial management

This Investment Decisions in Financial Market and Behavioral Finance training course is essential for any business, and which will be of benefit to a wide range of the participants and as such is aimed at:  

• Financial Managers and Financial Accounting Team Members
• Corporate Decision-makers
• Market Trends Specialist
• Risk and Return Analyst
• Merger and Acquisitions Specialists
• Auditors and Management Accountants
• Managers and those with financial responsibilities
• Analysts whose role involves evaluating and identifying market and competitive trends
• Strategic Planning and Head Office Team Members
• Corporate Communication and Investor Relations Professionals
• Investment Analysts and Advisers
• Traders
• Investors in general

Module 1: Essentials of Corporate Finance

DAY 1

Financial Management

• The Role & Scope of Corporate Financial Management
• Managing International Trade including:
  • Methods of Payment such as Letters of Credit, Collections
• Benefits & Risks
• The Objective of the Organisation and Stakeholder’s Needs
• The Financial Environment Post Banking Crisis
• Corporate Social Responsibility (CSR) and Corporate Governance

DAY 2

The Financing Decision        

• Long-Term Sources of Finance
• Types of Equity Capital
• Types of Debt
  • The Optimum Capital Structure / Leverage – Equity or Debt?
  • Weighted Cost of Capital (WACC) and The Capital Asset Pricing Model (CAPM)
• Calculating Your WACC and CAPM
• When & How to Use WACC and CAPM
• The Dividend Decision
• Short-Term Sources of Finance

DAY 3

The Investment Decision

• Establishing the Forecast Cash Flows
• International Issues, e.g.
  • Exchange Rate Risk
  • Transfer Payments
• Evaluating the Capital Investment Decision using:
  • Payback
  • Accounting Rate of Return (ARR)
  • Net Present Value (NPV)
  • Internal Rate of Return (IRR)
• Analysing the Investment Decision using:
  • What if Analysis
  • Sensitivity Analysis
  • Simulation

DAY 4

Risk and Treasury Management

• Identifying Financial Risks
  • Internal (SWOT Analysis)
  • External (PESTLE Analysis)
• Measuring Financial Risk
• Developing and Implementing a Risk Management Strategy
• Establishing a Treasury Department
• Treasury and Risk Management Techniques

DAY 5

Corporate Strategy

• Corporate and Financial Strategy
• Growth Strategies
• Joint Ventures, Merger, & Acquisitions
  • Valuation
  • Risks & Benefits
• Financing a Merger or Acquisition
• Capital Reconstruction or Restructure

Module 2: Behavioural Finance

DAY 6 

The Rise and Fall of Neoclassical Finance & The Rise and Rise of Behavioural Finance 

• Introduction
• Pillars of Conventional Finance
• The Failure of Neoclassical Finance
• The Illusion of Fama & French Revealed
• Efficient Market Hypothesis as the Cause of the Global Financial Crisis
• Bubbles and Crashes in the Stock and FX Market
• Why Academia & Authorities Embrace the EMH?
• Discarding Rationality
• Sources and Examples of Irrationality    
• Market Anomalies

DAY 7

The Financial Consequences of Behavioral Biases 

• Loss Aversion Bias
• Overconfidence Bias
• Representativeness Bias
• Anchoring Bias
• Self-serving Bias
• Disposition Effect
• Managerial Hubris
• Application to Working Capital Management

DAY 8

Behavioural Investment Strategies I

• Noise Trading
• Technical Analysis
• Momentum Trading
• Contrarian Investment Strategies
• High Frequency Trading and Multilateral Trading Platforms
• Energy Trading
• Commodity Trading
• Terrorism Risk

DAY 9

Behavioural Investment Strategies II 

• Fund Managers’ Behaviour
• The Green Effect
• Sustainable Finance
• Fintech
• Cryptocurrency
• Black Friday Effect
• Derivative Trading
• Financial Volatility from Brexit and COVID-19

DAY 10

Recent Developments in Behavioural Finance 

• Ecology and Finance
• Neuroscience
• Emotional Finance
• Quantitative Behavioural Finance
• Narcissism, Political Tenure, Financial Indicators, and the Effectiveness
• Wealth Effects and Diamond Risk Structure
• Trumpism Economics
• Seasonality in REIT
• Health Finance

In Association With

Oxford Management Centre

A GLOMACS - Oxford Management Centre collaboration aimed at providing the best training services and benefits to our valued clients.

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All rights reserved. Any unauthorized copying, distribution, use, dissemination, downloading, storing (in any medium), transmission, reproduction or reliance in whole or any part of this course outline is prohibited and will constitute an infringement of copyright.

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Tel : +971 - 04 - 425 0700, Fax : +971 (04) 425 0701, Email : info@glomacs.com