Psychological factors affecting stock prices and related theories

Globalization and pervasiveness of Internet usage enabled investors to move their funds from market to market. This reality leads to a more diverse universe for investors and in order to better understand their varying rationales, it is essential to take factors influencing their decision making process into account. Behavioral finance explains some of these factors and this paper examines and discusses some of the most important factors and theories affecting investor behavior in the literature. © 2014 Springer International Publishing Switzerland. All rights reserved.