SKEW YOU,

SAY THE BEHAVIORALISTS

By Mark Kritzman

Hedge funds and behavioral finance are hot topics in portfolio management. Hedge funds have grown to become a trillion dollar industry and the focus of seemingly endless journal articles. And behavioral finance devotees, once looked upon as members of the radical fringe, are now firmly ensconced in the mainstream, thanks in part to Daniel Kahneman’s Nobel Prize. It turns out that these two topics intersect in a particularly interesting way, which gives rise to my R-rated title.