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Behavioral finance is a field that comes under behavioral economics.It comes handy in analyzing why producers and suppliers make unreasonable systematic mistakes contrary to the presumption of rational market participants. Behavioral finance also studies how other market participants get benefits from such mistakes and market inefficiencies. Behavioral finance puts the light on inefficiencies like under or over reactions to the information as reasons of market trends and in cases of bubbles and crashes.These reactions get caused by limited investor attention, overconfidence, mimicry and noise trading.
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