Financial Market Equilibrium Under Financial Imbalance - A Case Study

14 Pages Posted: 1 Mar 2015

See all articles by Joanna Siwek

Joanna Siwek

Poznan University of Economics

Date Written: February 28, 2015

Abstract

The behavioural present value is usually modelled as fuzzy subset in the real line. In following paper the behavioural present value is applied to explain financial market paradox of simultaneous buying and selling a financial instrument by investors, which occurs despite following the same information. The main goal of this paper is to present an numerical example in form of a case study, which explains the mechanisms of this paradox. Also, an algorithm modelling the transaction under financial imbalance and behavioural premises is described.

Keywords: behavioural finance, present value, fuzzy set

JEL Classification: C44, C02, G10

Suggested Citation

Siwek, Joanna, Financial Market Equilibrium Under Financial Imbalance - A Case Study (February 28, 2015). Available at SSRN: https://ssrn.com/abstract=2571681 or http://dx.doi.org/10.2139/ssrn.2571681

Joanna Siwek (Contact Author)

Poznan University of Economics ( email )

Poznan, 60-967
Poland

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