A recent study has presented findings suggesting a shift in how asset pricing is approached. The research indicates that focusing on investor fear and anxiety may be a more influential factor than traditional risk assessment. The study analyzes historical market data and identifies correlations between emotional responses and investment outcomes. Researchers emphasize that while fear can drive short-term volatility, it doesn’t accurately predict long-term returns. The findings suggest a potential need to incorporate psychological factors into asset management strategies.
Credits: Finance & economics