Smart investment in specialised education course at the London School of Economics and Political Science

The Italian bank Fineco approached the London School of Economics and Political Science to design and run a custom-made, intensive course focusing on behavioural finance and investment decisions with which to reward its most strongly performing financial consultants.

Behavioural economics has revolutionised the understanding of how financial decisions are made. Comprehending human behaviour, rather than assuming perfectly rational decision making, is essential when considering how investors make portfolio choices.

LSE Enterprise created a two-day programme on ‘Portfolio Management and Behavioural Finance’ for 31 participants, led by Dr Erik Eyster from the Department of Economics, with simultaneous interpretation into Italian.

Following an overview and history of portfolio theory, the participants explored its underpinning assumptions of rational economics, along with its inconsistent behavioural anomalies. They examined attitudes towards risk and how people actually choose portfolios – as opposed to how rational economic theory predicts they will.

The chance to gain a wider perspective on their profession gave participants new insights which would enhance their portfolio management work more broadly. A Fineco Bank representative described the course as “a success, highly appreciated by Fineco’s top management,” and LSE Enterprise have subsequently run three further behavioural finance programmes for Fineco.

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