1. Behavioral finance is an approach to finance, not a sub-field.

2. Behavioral Finance Investor Welfare Asset markets –Volume –Returns Corporate Finance

3. Behavioral Finance (Psychology) Framing of Investment Options Overconfidence Loss Aversion Attention

4. Framing of Investment Options: Investor Welfare The “1/N” Heuristic –Benartzi and Thaler (AER, March 2001) Investment in Employer Stock –Benartzi (JF, forthcoming) Savings Plans –Benartzi and Thaler (2001 working paper)

5. Overconfidence: Investor Welfare, Trading Volume, Asset Pricing, Corporate Finance Theoretical Models –Odean (JF, 1998) –Daniel, Hirshleifer, Subrahmanyam (JF, 1998) Empirical Evidence –Odean (AER, 1999) –Barber and Odean (JF, 2000; QJE, 2001; RFS, 2002) Corporate –Heaton, QJE, 2002 –Gervais, Heaton, and Gervais (2002, working paper) –Malmendier & Tate (2002, working paper)

6. Loss Aversion: Investor Welfare, Asset Pricing (?), Corporate Finance(?) Stocks –Statman and Shefrin (JF, 1985) –Odean (JF, 1998) –Grinblatt and Keloharju (JF, 2000) Real Estate –Genesove and Mayer (1999) Futures –Locke and Mann (1999) Employee Stock Options –Heath, Huddart, and Lang (QJE, 1999)

7. Attention: Investor Welfare, Asset Pricing (?) Barber and Odean (2002, working paper)

8. Psychology Investor behavior Asset price models

9. Behavioral Finance The Role of Anomalies Anomalies are not Behavioral Finance The analysis of long-run returns is treacherous … but robust anomalies lead to a better understanding of financial markets

10. The Robust Anomalies Value Price Momentum Post-Earnings Announcement Drift The Size Effect (?)

11. Behavioral Finance as Good Science Data Dredging and Story Telling Model Dredging and Story Telling Know the Psychology Literature

12. General Comments Pick your research topics well –Ask (and answer) focused research questions –Shop your ideas with other scholars Execution –Write well –Avoid clutter (in methods and words) –Listen!

13. General Comments Topics –Interest –Focus Presentation –Writing –Interviews –Seminars