General Uncertainty in Portfolio Selection: a Case-based Decision Approach

General Uncertainty in Portfolio Selection: a Case-based Decision Approach
Author: Vasyl Golosnoy
Publisher:
Total Pages:
Release: 2008
Genre:
ISBN:

Abstract: Often a portfolio investor can hardly imagine all states of nature relevant to his investment problem, causing general uncertainty concerning an asset allocation model. We quantify general uncertainty as the weakness of an investor's belief in a conventional portfolio procedure, then we develop the case-based decision-making approach for determining the optimal belief degree. The economic effect of the proposed case-based methodology is investigated in the empirical study. The empirical results suggest two successful patterns of case-based decisions that could be linked to the issue of market efficiency. Moreover, our case-based modeling reflects some behavioral phenomena observed on financial markets

Portfolio Decision Analysis

Portfolio Decision Analysis
Author: Ahti Salo
Publisher: Springer Science & Business Media
Total Pages: 410
Release: 2011-08-12
Genre: Business & Economics
ISBN: 1441999434

Portfolio Decision Analysis: Improved Methods for Resource Allocation provides an extensive, up-to-date coverage of decision analytic methods which help firms and public organizations allocate resources to 'lumpy' investment opportunities while explicitly recognizing relevant financial and non-financial evaluation criteria and the presence of alternative investment opportunities. In particular, it discusses the evolution of these methods, presents new methodological advances and illustrates their use across several application domains. The book offers a many-faceted treatment of portfolio decision analysis (PDA). Among other things, it (i) synthesizes the state-of-play in PDA, (ii) describes novel methodologies, (iii) fosters the deployment of these methodologies, and (iv) contributes to the strengthening of research on PDA. Portfolio problems are widely regarded as the single most important application context of decision analysis, and, with its extensive and unique coverage of these problems, this book is a much-needed addition to the literature. The book also presents innovative treatments of new methodological approaches and their uses in applications. The intended audience consists of practitioners and researchers who wish to gain a good understanding of portfolio decision analysis and insights into how PDA methods can be leveraged in different application contexts. The book can also be employed in courses at the post-graduate level.

The Mystery of Rationality

The Mystery of Rationality
Author: Gérald Bronner
Publisher: Springer
Total Pages: 259
Release: 2018-07-12
Genre: Philosophy
ISBN: 3319940287

This book contributes to the developing dialogue between cognitive science and social sciences. It focuses on a central issue in both fields, i.e. the nature and the limitations of the rationality of beliefs and action. The development of cognitive science is one of the most important and fascinating intellectual advances of recent decades, and social scientists are paying increasing attention to the findings of this new branch of science that forces us to consider many classical issues related to epistemology and philosophy of action in a new light. Analysis of the concept of rationality is a leitmotiv in the history of the social sciences and has involved endless disputes. Since it is difficult to give a precise definition of this concept, and there is a lack of agreement about its meaning, it is possible to say that there is a ‘mystery of rationality’. What is it to be rational? Is rationality merely instrumental or does it also involve the endorsement of values, i.e. the choice of goals? Should we consider rationality to be a normative principle or a descriptive one? Can rationality be only Cartesian or can it also be argumentative? Is rationality a conscious skill or a partly tacit one? This book, which has been written by an outstanding collection of authors, including both philosophers and social scientists, tries to make a useful contribution to the debates on these problems and shed some light on the mystery of rationality. The target audience primarily comprises researchers and experts in the field.

Behavioral Game Theory

Behavioral Game Theory
Author: Russell Golman
Publisher: MDPI
Total Pages: 128
Release: 2021-01-07
Genre: Business & Economics
ISBN: 3039437739

How do interacting decision-makers make strategic choices? If they’re rational and can somehow predict each other’s behavior, they may find themselves in a Nash equilibrium. However, humans display pervasive and systematic departures from rationality. They often do not conform to the predictions of the Nash equilibrium, or its various refinements. This has led to the growth of behavioral game theory, which accounts for how people actually make strategic decisions by incorporating social preferences, bounded rationality (for example, limited iterated reasoning), and learning from experience. This book brings together new advances in the field of behavioral game theory that help us understand how people actually make strategic decisions in game-theoretic situations.

Individuality and Entanglement

Individuality and Entanglement
Author: Herbert Gintis
Publisher: Princeton University Press
Total Pages: 384
Release: 2016-10-18
Genre: Business & Economics
ISBN: 1400883164

A richly transdisciplinary account of some fundamental characteristics of human societies and behavior In this book, acclaimed economist Herbert Gintis ranges widely across many fields—including economics, psychology, anthropology, sociology, moral philosophy, and biology—to provide a rigorous transdisciplinary explanation of some fundamental characteristics of human societies and social behavior. Because such behavior can be understood only through transdisciplinary research, Gintis argues, Individuality and Entanglement advances the effort to unify the behavioral sciences by developing a shared analytical framework—one that bridges research on gene-culture coevolution, the rational-actor model, game theory, and complexity theory. At the same time, the book persuasively demonstrates the rich possibilities of such transdisciplinary work. Everything distinctive about human social life, Gintis argues, flows from the fact that we construct and then play social games. Indeed, society itself is a game with rules, and politics is the arena in which we affirm and change these rules. Individuality is central to our species because the rules do not change through inexorable macrosocial forces. Rather, individuals band together to change the rules. Our minds are also socially entangled, producing behavior that is socially rational, although it violates the standard rules of individually rational choice. Finally, a moral sense is essential for playing games with socially constructed rules. People generally play by the rules, are ashamed when they break the rules, and are offended when others break the rules, even in societies that lack laws, government, and jails. Throughout the book, Gintis shows that it is only by bringing together the behavioral sciences that such basic aspects of human behavior can be understood.

Goal-Directed Decision Making

Goal-Directed Decision Making
Author: Richard W. Morris
Publisher: Academic Press
Total Pages: 486
Release: 2018-08-23
Genre: Psychology
ISBN: 0128120991

Goal-Directed Decision Making: Computations and Neural Circuits examines the role of goal-directed choice. It begins with an examination of the computations performed by associated circuits, but then moves on to in-depth examinations on how goal-directed learning interacts with other forms of choice and response selection. This is the only book that embraces the multidisciplinary nature of this area of decision-making, integrating our knowledge of goal-directed decision-making from basic, computational, clinical, and ethology research into a single resource that is invaluable for neuroscientists, psychologists and computer scientists alike. The book presents discussions on the broader field of decision-making and how it has expanded to incorporate ideas related to flexible behaviors, such as cognitive control, economic choice, and Bayesian inference, as well as the influences that motivation, context and cues have on behavior and decision-making. - Details the neural circuits functionally involved in goal-directed decision-making and the computations these circuits perform - Discusses changes in goal-directed decision-making spurred by development and disorders, and within real-world applications, including social contexts and addiction - Synthesizes neuroscience, psychology and computer science research to offer a unique perspective on the central and emerging issues in goal-directed decision-making

Qualitative Investment Decision-Making Methods under Hesitant Fuzzy Environments

Qualitative Investment Decision-Making Methods under Hesitant Fuzzy Environments
Author: Wei Zhou
Publisher: Springer
Total Pages: 156
Release: 2019-03-22
Genre: Technology & Engineering
ISBN: 3030113493

This book describes five qualitative investment decision-making methods based on the hesitant fuzzy information. They are: (1) the investment decision-making method based on the asymmetric hesitant fuzzy sigmoid preference relations, (2) the investment decision-making method based on the hesitant fuzzy trade-off and portfolio selection, (3) the investment decision-making method based on the hesitant fuzzy preference envelopment analysis, (4) the investment decision-making method based on the hesitant fuzzy peer-evaluation and strategy fusion, and (5) the investment decision-making method based on the EHVaR measurement and tail analysis.

Financial Economics, Risk And Information (2nd Edition)

Financial Economics, Risk And Information (2nd Edition)
Author: Marcelo Bianconi
Publisher: World Scientific Publishing Company
Total Pages: 496
Release: 2011-11-29
Genre: Business & Economics
ISBN: 9814405124

Financial Economics, Risk and Information presents the fundamentals of finance in static and dynamic frameworks with focus on risk and information. The objective of this book is to introduce undergraduate and first-year graduate students to the methods and solutions of the main problems in finance theory relating to the economics of uncertainty and information. The main goal of the second edition is to make the materials more accessible to a wider audience of students and finance professionals. The focus is on developing a core body of theory that will provide the student with a solid intellectual foundation for more advanced topics and methods. The new edition has streamlined chapters and topics, with new sections on portfolio choice under alternative information structures. The starting point is the traditional mean-variance approach, followed by portfolio choice from first principles. The topics are extended to alternative market structures, alternative contractual arrangements and agency, dynamic stochastic general equilibrium in discrete and continuous time, attitudes towards risk and towards inter-temporal substitution in discrete and continuous time; and option pricing. In general, the book presents a balanced introduction to the use of stochastic methods in discrete and continuous time in the field of financial economics.