Literature Review Of Behavioural Finance In Investment - Free Essay Example

Sample details Pages: 19 Words: 5679 Downloads: 1 Date added: 2017/06/26 Category Finance Essay Type Analytical essay Did you like this example? This chapter is a detailed exploration of the behavioural finance literature relevant to the research objectives. The author will explore the beginnings and the development of the framework and will critically analyse the points of the literature which are essential for the research conducted in this study. 1.0 Introduction Don’t waste time! Our writers will create an original "Literature Review Of Behavioural Finance In Investment" essay for you Create order The financial theory based on Modern Portfolio Theory (Markowitz, 1952) and the Capital Asset Pricing Model (Sharpe, 1964), has long shaped the way in which academics and practitioners analyse investment performance. The theory is based on the notion that all investors act rationally and consider all available information in the decision-making process and that therefore investment markets are efficient, reflecting all available information. According to Baberis and Thaler (2002), rationality is defined thus : Rationality means two things. First, when they receive new information, agents update their beliefs correctly, in the manner described in Bayes Law ¹. Second, given their beliefs, agents make choices that are normatively acceptable, in the sense that they are consistent with Savages notion of subjective expected utility ² Therefore, when an investor learns something new about a future cash flow concerning a particular security, they should respond in an efficient manner to this new information, in turn pushing up the price when the news is good and bringing prices down when news is bad. As a consequence, security prices should fully incorporate all available information almost immediately.  ¹Bayes law is a formula for calculating the probability that something (called A) is true or will be true, given a certain set of circumstances (called B)  ² Expected utility theory predicts that the betting preferences of people, with regard to uncertain outcomes (gambles), can be described by a mathematical relation which takes into account the size of a payout, the probability of occurrence, risk aversion, and the different utility of the same payout to people with different assets or personal preferences. During the 1980s and 1990s, contradictory evidence began to emerge that led many academics to reconsider the foundations of traditional finance. Empirical studies discovered anomalies and excess volatility in the stock markets that could not be explained by traditional finance models and suggested that academics should look to other fields of research to explain these discrepancies. In response to the growing number of problems, a new area of research emerged which offered an alternative explanation to the essential question of why prices deviate from their fundamental values. In the 1990s, a lot of the focus of academic discussions moved away from the rigid models of traditional finance towards developing theories on human behaviour and how it relates to financial markets. Behavioural Finance is the integration of traditional finance and economics with the psychological and decision making sciences. Its main argument is based on the claim that human behaviour and perceptions represent two crucial elements of financial decision making (Hirshleifer, 2001). Behavioural Finance scholars started the search for new models and ideas to help explain and predict investor behaviour. They assumed that investors may be irrational in their reactions to new information and make wrong investment decisions. As a result markets will not always be efficient and asset pricing may deviate from predications of traditional market models. There are a number of behavioural finance models which try to suggest that agents fail to update their beliefs correctly (Kahneman Tversky, 1979). This review will evaluate the literature in the field of behavioural finance and will focus on the two main building blocks the limits of arbitrage and investor psychology. In the first section, the limits of arbitrage will be explored, with the main focus on market efficiency and noise traders. In the following section, the focus will be on the psychological aspect of behavioural finance, focusing on the extensive experimental evidence which illustrates how people form their beliefs and make decisions. 2.0 Traditional Framework In the period between the early 1950s and late 1960s, instrumental research in the area of traditional finance was conducted. This was a very productive time for financial thought with many theorists putting together complex mathematical models to try and explain price behaviour. In these models, human behaviour and reasoning were over-simplified as researchers tried to invent practical empirical models. The most influential model which emerged from this period was the Efficient Markets hypothesis (EMH) (Fama, 1970), a theory which, even in todays changing environment, still represents a cornerstone of academic finance. This theory states that markets are considered to be efficient relative to a given information set, providing there are no abnormal profit opportunities for investors trading on the basis of information (Fama, 1970). The EMH implies that it is virtually impossible for investors to consistently beat the market, unless by luck. The EMH theoretical foundations are based on three underlying principles (Fama, 1970). The first assumption is that investors are fully rational. Therefore, when an investor learns something new about a future cash flow concerning a particular security, they should respond in an efficient manner to this new information, in turn pushing up the price when the news is good and bringing prices down when news is bad. As a consequence, security prices should fully incorporate all available information almost immediately. Secondly, as irrational investors transactions are conducted in a random manner, their irrationalities will offset each other, with the result that stock price will not be affected in any way. Subsequently the market may remain efficient even if not all investors are acting rationally. Their investment decisions are conducted in a random way and every trade made is likely to cancel the others out. Therefore an irrational investor will not be able to gain sufficient momentum to influence fundamental asset prices. The final assumption believes that the rational investor will arbitrage away the irrational investors influences on the underlying stock price. When a large group of irrational investors trade in a similar style and together they manage to move prices away from their equilibrium value, it is presumed that rational arbitrageurs will quickly notice the mispricing and act accordingly to return the prices to normal. If these three underlying principles hold and people are rational, then markets in turn will be efficient. There are a number of other quantitative models which emerged out of this traditional school of thought. The modern Portfolio Theory, the Capital Asset Pricing Model and the Arbitrage Pricing Theory are models which underpin the rational expectations based theory. However, there is a large amount of data and research which contradicts their foundations. For example, Fama and French (1993) have shown that the basic facts about the aggregate stock market, the cross-section average returns and individual trading behaviour are not easily understood in this framework. 3.0 Background of Behavioural Finance As cited by Shiller (2002) : Finance from a broader social science perspective including psychology and sociology is now one of the most vital research programmes and it stands in sharp contradiction to much of the efficient markets theory In the early 1990s, a lot of the focus of academic discussion moved away from the neoclassical frameworks of stock valuation towards developing models of human psychology and its relation to financial markets. As such, the Behavioural Finance paradigm has emerged in response to the difficulties faced by the traditional framework in explaining ÃÆ' ¢Ãƒ ¢Ã¢â‚¬Å¡Ã‚ ¬Ãƒâ€šÃ‚ ¦. and in essence it argues that investment choices are not always made on the basis of full rationality. It also attempts to understand the investment market phenomena by relaxing the two doctrines of the traditional framework, that is, firstly, that agents fail to update their beliefs correctly and, secondly, that there is a systematic deviation from the normative process in making investment choice. Bowman and Buchanan (1995) acknowledge that The knowledge on human behaviour should be used in order to help us understand how investors may misperceive the results of their actions and by extension, the functioning of the share market. The expectations-based models argue that the irrationality exhibited by investors will be undone through the process of arbitrage (Freidman, 1953). Behavioural Finance argues that there are limits to arbitrage, which allow investor irrationality to be substantial and to be able to have a long-term impact on prices. To explain investor irrationality and their decision making processes, Behavioural Finance draws upon the experimental evidence of the cognitive psychology discipline and the biases which arise when people form their beliefs and preferences (Baberis Thaler, 2002). Therefore, limits to arbitrage and psychology are seen as the two major building blocks of behavioural finance. 3.1 Limits of Arbitrage Behavioural Finance does not negate the arbitrage mechanism per se and its price correcting ability. However, it argues that not every deviation from fundamental value created by actions of irrational traders will be an attractive investment opportunity for rational arbitrageurs (Szyszka, 2008). Even when an asset is highly mispriced, many arbitrage strategies, which are designed to correct and eliminate the fundamental mispricing, are ultimately risky and costly for the arbitrageur. Therefore many strategies are perceived to be unattractive and this results in the mispricing remaining unchallenged for a comparatively long period of time. The theory of arbitrage can be traced back to Friedman (1953), who stated that rational traders will quickly undo any mispricing caused by irrational traders. Friedmans argument is based on two underlying assumptions. Firstly, as soon as an asset deviates from its fundamental value, an attractive investment opportunity will arise from this mispricing. Secondly, rational traders will immediately react to the situation by purchasing the asset, thereby correcting the mispricing. Behavioural Finance doesnt dispute the fact that an attractive investment opportunity will be exploited it argues that arbitrage strategies developed to correct the mispricing can be both risky and costly, resulting in the mispricing remaining unchallenged. 3.2 Fundamental Risk When an arbitrageur observes a mispriced asset on the market, he needs to find a similar asset which is priced correctly on another market, to enable him to correct this mispricing, thus taking an opposite arbitrage position. If the trader is unable to take up this position, he faces fundamental risk, that is, the risk that new information comes to the market and changes the fundamental value of the asset in the wrong direction. Even when arbitrageurs are able to hedge the fundamental risk that they face and take a long position in the asset where it is cheaper and a short position in the same asset on another market where it is more expensive, the trader is still exposed to Noise Trader Risk. 3.3 Noise Trader Risk Noise trader risk can be defined as the risk that irrationality on the market may become stronger and may drive mispricing to an even greater extent (Shleifer Vishny, 1997). As the mispricing increases, the gap between long and short positions increases which in turn goes against the belief of rational arbitrageurs. If this trend continues, an arbitrageur whose investment horizon is usually relatively short and who often borrows money to fund his trades, may be forced to close his positions before the mispricing is corrected, ultimately resulting in him suffering significant losses. Shleifer (2000) has argued that noise trader risk, the risk from traders who are attempting to buy into rising markets and sell into declining markets, limits the extent to which one should expect arbitrage to bring prices quickly back to rational values, even in the presence of an apparent bubble. Even the most rational arbitrageurs will regret selling a share short which may collect a greater price in the future, even if that price is unreasonably high. Rational arbitrageurs cannot entirely eliminate the effects of noise traders on the market if the size and the ability of the former group to trade are very limited (Camerer, 1989). Consequently, a single arbitrageur who notices a mispricing in the market faces not only the noise trader risk, but also the risk of synchronization of actions of other rational traders (Abreu Brunnermeier (2002). Typically, a single arbitrageur does not have the momentum to correct the mispricing on his own. The individual needs other arbitrageurs to follow his strategy. However, the individual does not know if and how quickly other rational traders will react to the same arbitrage opportunity and take up a similar positions. Also, the risk aversion of arbitrageurs by itself limits their ability to cancel noise traders, even if arbitrageurs have infinite buy-and-hold horizons (Shiller, 1984). As stated by Black (1986), if noise traders undervalue or overvalue stocks for a long period of time, the short horizon under which arbitrageurs performance is evaluated, limits their ability to force asset prices back to their fundamental values. As a result, due to the limitations of arbitrage, noise traders are able to force asset prices away from their equilibrium value for extended periods of time. Rational arbitrageurs also have to realise that noise trader strategies may become even more extreme and unpredictable, resulting in increased risk for the arbitrageur. This additional risk is referred to as noise investor risk. Noise investor risk is systematic and non-diversifiable which in turn creates additional volatility on the stock markets. Rational arbitrageurs would not bear this risk unless compensated with higher expected returns (De Long et al., 1990). This once again limits the successfulness of rational arbitrageurs. 3.4 Implementation Barriers Arbitrage can become a costly activity for a number of reasons. Firstly, transaction costs, which include bid-ask spreads, commissions and price impact, can limit the arbitrageur in exploiting an obvious mispricing. Secondly, the fees charged for borrowing stocks to take a short position can often be off-putting. As cited by Baberis and Thaler (2002), DAvolie (2002) finds That for most stocks, they range between ten and fifteen basis points but they can be much larger; in some cases, arbitrageurs may not be able to find shares to borrow at any price. A further barrier they may face is legal constraints. For example, in many large pension funds, short-selling is prohibited altogether. Finally, the vast amount of research and learning required to exploit a mispricing in a further deterrent. Shiller (1984) found that even if noise trader demand causes a persistent mispricing, it may not be detectable for arbitrageurs unless they expend large amounts of time and resources. 3.5 Evidence Limits of arbitrage have been confirmed empirically by cases of evident mispricing that remain unchallenged in the market for long periods of time. An example of this is the case of twin shares. In 1907, Royal Dutch and Shell merged their interests on a 60:40 basis while both remained separate entities. The stocks of Royal Dutch traded mostly on the US and Dutch Stock Exchange and were to claim 60 percent of the total cash flow, while shares in Shell, which traded in the UK, were to claim 40 percent of the total cash flow of the two firms. Theoretically, the market value of Royal Dutch equity should always be 1.5 times greater than the market value of Shell. Empirical evidence shows that Royal Dutch was sometimes 35 percent underpriced relative to Shell and at times they were 15 percent overpriced. It took until 2001 for the shares to finally sell at their correct values. This is a key example where two shares which are perfect substitutes for each other, would allow the opportunity of easy arbitrage profits. The main risk in this situation is noise trader risk and there is the fear that the share will become even more undervalu ed in the near future. A further example of the limits of arbitragecomes from the inclusion of a new stock on the SP 500. Schleifer (1986) discovered that when a stock is added to the index, the price jumps on average by 3.5 percent and much of this increase remains. A prime example of this is when Yahoo was added to the index, its share price rocketed 24 percent in a single day. Arbitrage is limited in this case due to the fundamental risk and noise trader risk faced by traders. They may find it is very difficult to find a substitute stock and also there is the risk that the price will continue to rise in the short run. In the case of yahoo, its share price was $115 before its addition in the index and it had risen to $214 a month later. Behavioural theorists show that the strategies required to correct the mispricing can be both costly and risky, thus rendering the mispricing opportunity unattractive and allowing them to continue. The examples of Yahoo and Royal Dutch outlined above confirm this point perfectly. 4.0 Psychology aspect of Behavioural Finance The theory of limited arbitrage shows that if irrational traders cause deviations from fundamental value, rational traders will often be powerless to do anything about it (Baberis Thaler, 2002). In order to explain the various investor behaviours in financial markets, behavioural analysts draw on the knowledge of human cognitive behavioural theories and analyse extensive experimental evidence which shows the systematic biases which arise when people form beliefs or preferences. 4.1 Judgement Under Uncertainty 4.1.1 Overconfidence Behavioural finance assumes that agents may be irrational in their reactions to new information and investment decisions. One of the observations of behavioural theorists has been the overconfidence phenomena. Overconfidence allows many of the anomalies and price deviations in traditional finance to be explained, something which standard economic theory struggles to do. People can make mistakes when they receive information and form their beliefs. Extensive evidence shows that individuals tend to be overconfident in their own beliefs and judgements (Odean and Barber, 2000). These individuals also tend to be over-optimistic and perceive things to be far better than they actually are. In general terms, overconfidence and over-optimism make investors trade at far too high a volume and sometimes at far too high a price. Research also shows that when an individual has formed an opinion, he often adheres to it and inadequately updates his beliefs in the line of new information. As a result of the above behaviours, people tend to take too many risks and fail to change their beliefs even after occurring heavy losses. This is turn could cause the stock market to overreact. 4.1.2 Representativeness and Conservatism Conservatism can be defined as the condition where investors are subconsciously reluctant to alter their beliefs in the face of new evidence (Edwards, 1968). This bias affects an investors decision-making process, as even if an investor changes his beliefs in the light of new information, the extent of that change is relatively small in terms of what it should be under strictly rational conditions. Edwards (1968) conducted an experiment which tested a subjects ability to revise probabilities in the light of new evidence. This experiment was constructed so that there was only one correct answer to the probability revision problem given to the subject. It found that people tended to revise their probabilities in the correct direction, but tended not to revise them enough. It was found that people respond insufficiently to new information and this has been replicated in a number of papers such as Beach and Braun (1994) and is now referred to as conservatism bias. Representativeness Heuristic The representativeness heuristic as documented by Kahneman Tversky (1974) can also play an important role in driving overconfidence. They recognised that in forming subjective judgments, people have a tendency to disregard base rate probabilities, and to make judgements based solely in terms of observed similarities to familiar patterns (Shiller, 2001). For example, when people try to determine the probability that a data set A was generated by a model B, or that an object A belongs to a class B, they often use the representativeness heuristic. This means that they evaluate the probability by the degree to which A reflects the essential characteristics of B (Baberis Thaler, 2002). Under the representativeness heuristic, investors will consider a number of positive company performances as a representative of continuous growth potential and ignore the possibility that this performance is of a random nature. This can encourage the investor to expect instinctively that past price changes will continue, even if his professional training tells him that this should not happen (Shiller, 2001). 4.1.3 Anchoring Kahneman and Tversky (1974) argue that when forming estimates, people often start with some initial, possibly arbitrary value, and then adjust away from it. Experimental evidence shows that the adjustment is often insufficient, resulting in the tendency to anchor too much on the initial value. Anchoring is a term used in psychology to describe the common human tendency to rely too heavily or anchor on one trait or piece of information when making decisions. During the normal decision making process, individuals anchor, or rely too heavily, on specific information or a specific value and then adjust to that value to account for other elements of the circumstances. In Kahneman and Tverskys empirical study, subjects were asked to estimate the percentage of United Nations countries which are African. In each case, a number between zero and one-hundred was assigned as an initial value and the subject was asked if this was too high or too low, and what adjustment was needed to be made. Despite the fact that each of the subjects knew that the initial value had been determined randomly, by spinning a wheel in the subjects presence, there still was a tendency to be biased towards the initial value. This phenomenon can be related to the financial markets by looking at how investors pay too much attention to the past prices of securities. Studies have found that the two most common numbers to which investors appear to anchor, are the fifty-two week high and the fifty-two week low for a stock. There is a market tendency for people to assume that a stock has the potential to get back to its fifty-two week high but not breech its fifty-two week low. The problem with this thought process is that it assumes that those numbers are an indication of value and are not just random outcomes based on the fads that can be witnessed in the market. 4.1.4 Mood and Emotion Judgments based on mood and emotion, rather than rational valuation, can play an important part in investor decision making. A number of recent studies have used environmental factors to investigate whether mood and emotion influence investor choices and stock market prices. Kamstra, Kramner and Levi (2003) investigated Seasonal Affective Disorder (SAD), which tries to find a link between depression and the lack of winter sunlight. Their findings indicate that in markets where SAD is prominent, there is a high amount of seasonal variation in returns. They conclude that the variation is due to the changing risk aversion of SAD investors. Further studies have linked variations in returns to lunar cycles and weather related optimism and pessimism. Stock Markets in the United States of America are slightly more prone to more positive returns on days with less cloud cover (Elton and Gruber, 2007). Additional studies by Saunders (1993) support this notion by suggesting that capital markets , on average, have higher returns on days of good weather than on days with heavy clouds or rain. A recent study by Lo and Repen (2002), as cited in Elton and Gruber (2007), attempts to measure the affect in real time of emotions through documenting physiological changes experienced by investors. Lo and Repen attached wires to a number of investors at a hedge fund company to enable the researchers to monitor their responses to risk and volatility. The results of their findings indicate that news events and volatility extract emotional responses with experienced traders remaining calmer in these circumstances. Lo and Repens study ultimately concluded that emotion plays a role in the decision making of trader, which contradicts the theory of rational investors. 4.2 Behavioural Finance Models There have been a number of models developed in an attempt to capture the behaviour of investors. Perhaps the most influential of these is prospect theory (Kahnemand Tversky, 1979). This theory will be explored below and will provide the foundations for the research study. 4.2.1 Prospect theory The traditional finance theory assumes that investors make decisions under uncertainty by maximising the expected utility of wealth or consumption. The expected utility theory, which was formalised by Von Neuman Margenstein in 1947, shows that if preferences satisfy a number of plausible axioms completeness, transivity, continuity, and independence then they can be represented by the expectation of a utility function (Baberis Thaler, 2002). However, the underlying assumptions of this theory have been shown by many studies to be an inaccurate explanation of how people actually behave when choosing between risky alternatives. Prospect theory seeks to explain decisions which are inconsistent with rational probability assessment and standard utility theory. The proponents of the expected utility theory assume that investors are fully rational when facing a gamble. The theory assumes that every individual has an information set which might differ among investors, but it also assumes that every individual analyses this data in a rational manner. According to expected utility theory, all information is equally weighted. This is, however, one of the main contradictions with both prospect theory and behavioural finance. Under expected utility theory, risk preferences are captured by the shape of the utility function. Decision makers are risk averse if U(x) is concave, and risk seeking if U(x) is convex, with the most classical financial theory based on the tenet that decision makers are risk-averse. One standard interpretation for risk aversion is that the usefulness of an additional dollar decreases as a person gets wealthier, a principle known as diminishing marginal utility. A utility function which exhibits diminishing marginal utility i s concave and hence the decision maker is risk averse. In relation to the investors attitude to risk, the expected utility hypothesis adopts a stance which seems to be contradicted by empirical research. Even though it allows for different attitudes towards risk, it does perceive this attitude to be constant. Therefore, if an investor faces a loss or a gain prospect, they will always have the same attitude to risk. Moreover, this theory relies on the assumption that investors think about final wealth states and not about gains or losses, which once again contradicts the behavioural finance paradigm. Prospect theory seeks to explain decisions which are inconsistent with rational probability assessment and standard utility theory. Prospect theory is an important theory for decision making under uncertainty. It departs from the traditional expected utility framework as it provides a psychological explanation to the behavioural tendencies of portfolio selection. Prospect theory was developed in 1979 by two psychologists, Daniel Khaneman and Amos Tversky, who advised that prospect theory is a descriptive model of decision making under uncertainty which can be used to explain behavioural tendencies. It implies that people value gains and losses differently and as a result will base their decisions on perceived gains rather than losses. Therefore, prospect theory evaluates peoples attitudes to risky gambles and presumes that agents are risk averse in the domain of gains but risk-seeking when all changes in wealth are perceived as losses. According to Kahneman Tversky (1979), people vi olate the expected utility theory in three main ways the certainty effect, the reflection effect and the isolation effect. The first problem Kahneman and Tversky found relates to the fact that people tend to put too much weight on certainties. That is, if the investor is faced with a gamble which has an outcome that is certain, they will favour this if the other option is merely probable. This clearly contradicts the expected utility hypothesis which states that a rational investor will make his choice of action only depending on the outcomes utility. The best know counter-example to expected utility theory which exploits the certainty effect was introduced by the French economist Maurice Allias in 1953. Kahneman Tversky (1979) use a set of experimental questions which are adapted from this original theory to further highlight this effect. They show that people prefer a certain outcome over a probable one, even if the average payoff for the uncertain outcome is far higher. This research agrees with the work previously completed by Allias, and shows a clear contradiction to the expected utility hypothesi s in which the rational individual is assumed to choose the option yielding the highest payoff. The second critique redefines the investors attitude towards risk. In relation to the expected utility hypothesis, the investors attitude towards risk is assumed to be constant and is usually risk averse. However, Kahneman Tversky (1979) state that this is not in line with reality and find that an individuals attitude towards risk is not a constant. They found that when a person is faced with a gamble which yields a positive outcome in relation to their initial level of wealth, then they are risk averse. However, KT find that this attitude changes to risk seeking or loving when the gamble contains negative outcomes in relation to the initial level of wealth. For example, when a gamble was offered where you could either loose 3000 for certain or lose 4000 with a probability of eighty percent, an overwhelming majority selected the uncertain gamble, even though the utility would be lower for a rational individual. If a person was given two identical choices, one expressed in terms of p ossible gains and the other in terms of possible losses, people would choose the latter even if they achieve the same result. According to prospect theory, losses have a more emotional impact than an equivalent amount of gains. For example, based on the traditional way of thinking, the amount of utility gained from receiving 50 should be equal to a situation in which you gained 100 and then lost 50. In both circumstances the end result is a net gain of 50. However, despite the fact that you still end up with the same result, the majority of people would favour a single gain of 50. The following experiment by Kahneman and Tversky (1979) illustrates prospect theory. A number of subjects answered questions which involved making judgements between two monetary decisions involving prospective gains and losses. The following questions were asked in the study You have $1,000 and you must pick one of the following choices : You have a 50% choice of gaining $1,000 and a 50% chance of gaining 0. You have 100% chance of gaining $500 You have $2,000 and you must pick one of the following choice A You have a 50% choice of losing $1,000 and 50% chance of losing 0. B You have 100% chance of losing $500. The results of the study found that the majority of people chose B for the first question and A for the second question. This implies that people are willing to settle for a reasonable level of gains, even if there is a chance of earning more, but are willing to engage in risk-seeking behaviour when they can limit their losses. In other words, people value their losses more heavily than an equivalent amount of gains. This is once again clearly in contrast with the expected utility theory as individuals focus on the gains or losses made instead of on final wealth. The final critique that Kahneman Tversky (1979) explore is the isolation effect. It tries to explain peoples behaviour when facing a complex situation and concludes that in order to be able to evaluate information, investors tend to evaluate it in isolation of other information. The results show that people do not make decisions based on the final outcome, instead investors isolate the later game and the probabilities involved and their decision will wholly depend on the probabilities of the part of the game they are involved in at that time. Prospect theory has an asymmetric attitude towards risk, depending on how the potential gains or losses relate to a certain reference point. This reference point could be current wealth, a neighbours wealth, or the price at which an asset is purchased (Elton Gruber, 2007). Kahneman and Tverskys utility function is concave above the given reference point and convex below the point. This structure creates risk aversion with respect to gains and risk seeking with respect to losses and can lead to different decisions depending on whether the outcomes are posed as gains or losses. Prospect theory can be used to explain the occurrence of the disposition effect. The disposition effect is defined as the tendency for investors to hold on to losing stocks for too long and sell winning stocks too soon. The most logical course of action for an investor would be to hold on to the winning stocks in order to further their gains and to sell losing stocks in order to minimise potential losses. There has been a number of empirical studies which agree with the above theory. Odean (1998) analysed the accounts at a large brokerage firm and found that there was a greater tendency to sell stocks with paper capital gains than losses. A further study found a similar effect among all types of investors in Finland where the investors failed to recognise losses. As cited by Elton and Gruber (2007), a study far afield from investing by Chen, Santos Lakshminarayanan (2005), has identified loss-aversion behaviour in Capuchin monkeys, suggesting that loss aversion is instinctive. Prospect theory can thus be seen to be applied to a diverse range of situations which appear inconsistent with standard economic rationality. 5.0 Conclusion In conclusion, the last five decades have seen the introduction and development of many leading theories in financial literature. One of the main theories to dominate this period was the subject of efficient markets. The Efficient Market hypothesis was initially well-favoured but it relied on many unrealistic assumptions. More recently, scholars and investment professionals have started to investigate an alternative theory to try and explain the mispricing which occurred using the traditional models. Behavioural finance attempts to inform people of the emotional factors and psychological processes which influence the individuals who invest in financial markets. Behavioural finance argues that not all investors are rational and are able to value correctly their decisions or the importance of new information. Behavioural Finance does not attempt to replace the traditional views and models of finance. Instead, it looks to fill some gaps and to offer realistic explanations as to why misp ricing can occur in the stock markets. This chapter has attempted to outline the key factors of behavioural finance and highlighted prospect theory as one of the main models used to demonstrate this theory. Based on this literature review, the subsequent chapter will address the methodologies used to achieve the research objectives.

Essay about The Time Machine A Social Critique of...

H G Wells was cynical of the Victorian class system and thoroughly disapproved of the way people were segregated, according to their wealth. Wells disagreed with England’s capitalist views, as he himself was a socialist. His novel The Time Machine is primarily a social critique of Victorian England projected into the distant future. He has taken segregation to its extremes and shows how far human evolution will go if capitalism continues unhindered. On travelling to the future he finds that this new world is not what he expected, as he feels vulnerable and ‘naked in a strange world.’ (Page 26) This panic then quickly transforms into frenzy as he then meets the Eloi who were all that he despised, creatures who were frail, had lost†¦show more content†¦This is like the Nineteenth Century as the upper class Victorians would walk about carefree as children have the freedom to do. 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The Twilight Saga 3 Eclipse PREFACE Free Essays

To my husband, Pancho, for your patience, love, friendship, humor, and willingness to eat out. And also to my children, Gabe, Seth, and Eli, for letting me experience the kind of love that people freely die for. Fire and Ice Some say the world will end in fire, Some say in ice. We will write a custom essay sample on The Twilight Saga 3: Eclipse PREFACE or any similar topic only for you Order Now From what I’ve tasted of desire I hold with those who favor fire. But if it had to perish twice, I think I know enough of hate To say that for destruction ice Is also great And would suffice. Robert Frost PREFACE ALL OUR ATTEMPTS AT SUBTERFUGE HAD BEEN IN VAIN. With ice in my heart, I watched him prepare to defend me. His intense concentration betrayed no hint of doubt, though he was outnumbered. I knew that we could expect no help – at this moment, his family was fighting for their lives just as surely as he was for ours. Would I ever learn the outcome of that other fight? Find out who the winners and the losers were? Would I live long enough for that? The odds of that didn’t look so great. Black eyes, wild with their fierce craving for my death, watched for the moment when my protector’s attention would be diverted. The moment when I would surely die. Somewhere, far, far away in the cold forest, a wolf howled. How to cite The Twilight Saga 3: Eclipse PREFACE, Essay examples

Crowd Sourcing for an Effective Way for Funding -myassignmenthelp

Question: Discuss about theCrowd Sourcing for an Effective Way for Funding. Answer: Introduction Crowdsourcing is very popular phenomenon through which organizations take help from public to help in achieving activities that are commonly performed by the employees/ contractors (Bayus, 2013). Crowdfunding can be defined as the process where the individuals appeal for contributions from public by making use of online platform, and it is turning out to be a powerful way for raising funds for new entrepreneurial ventures as well as projects. According to Massolution, a crowdsourcing firm specialising in research and advisory indicated that during 2012 there was seen a growth of 81 percent in the crowdfunding platforms and together they raised US$ 2.7 billion (Sally, 2013).Crowdsourcing can act as a tool with multiple benefits if it is leveraged in successful manner. This report will thus introduce the contemporary issues of crowdsourcing by putting forward supporting facts from literature reviews available. Further theoretical entrepreneurship frameworks will be applied to develop t he concept of crowdsourcing. Finally the report will also provide few effective applications as well as judgements so that advanced knowledge about crowdsourcing can be developed. Crowdsourcing A Concept of Funding There are many ways of financing the start-ups ( Bellefalmme, Lambert SChweinbacher 2011) and crowdsourcing is one of them in which crowd is being used to develop a profit-oriented activities of an organization. Crowdfunding is a part of crowdsourcing and both the phenomenon is different from each other. The term crowdsourcing was firstly coined by Jeff Howe in June 2006. The term has been defined as the cat of organisation or firm taking up the function that was earlier performed by employees and outsourcing to the undefined network of people in form of an open call (2). Crowdsourcing is different from other functions like open sourcing; user generated content (UGC), collective intelligence as well as outsourcing (Lehdonvirta Bright, 2015). Crowdsourcing cannot be considered as a silver bullet for economy, but it does provide various approaches that help the enterprises to operate in a successful and efficient manner in on-going changes in policies, technology skills as wells fluidity seen in the world economy. Businesses as well as various organizations believe that crowd can help them in dealing with various challenges ranging from simple rote tasks for example raising money / voting, image labelling to handling complex issues like designing of new products or services , strategic planning or brainstorming ideas. Crowdfunding is a form of crowdsourcing and it is related to outsourcing. Thus it means transferring task of one organization to another, thus crowdsourcing means outsourcing to crowd that is large group of individuals mainly through Internet. Companies use crowdsourcing like, involving customers in the innovation process of the company (Leimeister et al, 2009). Advantages of Crowdsourcing Although many people criticize crowdsourcing because companies treat it as a way for maximising their profits simply by outsourcing their functions which are traditionally conducted by employees to the public. This helps the companies to achieve huge savings in cost. This is the main reason why companys crowdsource, however there are various other reasons due to which organisations adopt crowdsourcing. First advantage of crowdsourcing is the huge size of the crowd itself which acts as a benefit. Whereas most of the companies have less than 10,000 employees and if the contrast is being considered then the potential size of the crowd that also relies on the activity that is crowdsourced. For example 65,000 mew videos were uploaded on YouTube when it was acquired by Google in 2006 (4). Thus it was because of the crowd only that is millions of YouTube users that so many videos were uploaded. It would have been tough even to imagine doing so for 50 odd employees at YouTube. The second adv antage of crowd is being geographically distributed (Luz, Silva, Novais, 2015) . The third advantage of crowdsourcing is diversity present in the crowd. It has been found that diverse group is able to outperform group of experts while solving problem. For example some big corporations cast their scientific issues which even their RD experts cannot resolve to the website known as InnoCentive. Currently InnoCentive users have successfully resolved more than half of the challenges or problems posted (Cheung, 2012). The last and fourth advantage of crowdsourcing is that it reduces the cost of utilising the crowd in order to perform the task. Leveraging Business through Crowdsourcing Crowdsourcing acts as a tool that can be used for boosting efficiency as well as creativity and helps in creating better and positive customer experience. It can help in filling up the labour gaps in efficient manner for basic tasks or short-term projects. Like Amazon Mechanical Turk helps the companies in outsourcing tasks like transcription, verification , photo moderation etc. which needs human intelligence. In the field of creativity it helps in website deigning to logo overhaul. Thus crowdsourcing acts as a cost effective method for the businesses to access custom design work. Design Hill / 99Deisgns are the crowdsourcing platforms which help businesses in crowdsourcing design options related to marketing collateral , branding , websites as well as advertisements (Canarelli, 2017). Crowdsourcing is also a form of crowdsourcing. There are platforms like Fundable , ANgelList and Kickstarter which help the businesses , artists and entrepreneurs in raising money without taking help from traditional funding channels like venture capital or business loans . Thus crowdfunding is a tool which helps in attracting start-ups and it is not just for the new ventures only. Even well established businesses can use crowdfunding for expansion of their services, launch of new products as well as for the fund programs which aim at giving back to the community (Canarelli, 2017). Crowdsourcing to Crowdfunding When a company is started the entrepreneurs in the field of technology face several challenges for example limited funds, lack of resources and wide range of technical issues. Accessing the local funding is very tough as well as restrictive. On top of that searching for resources within a limited budget is a challenging task. In such cases crowdsourcing acts as a compelling idea which tackles all these issues by creating connections with resources as well as talented people all across the globe. These connections act as opportunities for entrepreneurs so that they can grow the community by adding talent form the target crowd, creating solutions for technical issues as well as by finding the desired resources (Smith, Manesh, Alshiakh, 2013). Thus crowd funding acts as a very fresh and recent method for funding the start-ups and it is gaining lot of popularity too. It is just like taking a loan, contribution / investments or pre-order from more than one person and that too at the same time. Crowdfunding works in a way where an entrepreneur puts a detailed description of the business on a crowdfunding platform. The main aims of the business will also be mentioned along with the plans for deriving profits from business, the amount of funding required and the reason why funds are required etc. Then the customers read all the information about the business and then decide to help with money if they find the idea genuine one. The people who give money make online pledge, while promising that they will pre-buy the product or give a donation. Anyone can make monetary contributions to help the business in which they believe(Michel, Gil, Hauder, 2015) . Crowdfunding is a good option for start-ups to raise funds simply because it can generate interest and thus helps the business in marketing the product along with arranging for finances. It also acts as a boon for the business in case one is not sure about the demand of the product being thought of. The process of crowdfunding cuts the professional brokers as well as investors as the funding is fully in the hands of common people. It can also attract venture-capital investment in case the company has a successful campaign. Crowdfunding however, is very competitive place to get funds, is gaining the attention of average customers just with the help of description or images online is very tough. Some of the well knows crowdfunding websites in US include: RocketHub, Onevest, GoFundMe, DreamFunded and Kickstarter (ProfitBooks, 2017). Start-ups and Crowdfunding Crowdsourcings very well-known model is the Open Collaboration (OC) Model where the problems or the opportunities made available are being posted by the organisation to the public with the help of IT systems . The crowds voluntarily engage in these ventures without any expectation of monetary compensations (Mergel, 2015). Some examples of OC crowdsourcing include starting an enterprise like Wiki or making use of online as well as social media communities for gaining contributions (Leimeister et al, 2009). The crowds level of engagement is related to several factors for example efficacy of the open call, the crowd capital of company and reach as well as engagement of the platform that is being used (Prpi? Shukla, 2013). For example as of May, 2015 Twitter quoted it has more than 500 million users and out of all these users more than 310 million are found to be active on monthly basis.. Thus it does not convert into significant engagement from users potential pool on platform. Tourna ment Crowdsourcing (TC) is another form of crowdsourcing where the organisations post their issues on specialised IT platforms like Eyeka or Kaggle or on in-house platforms like Challenge.gov (Zhang, Gu, Song, Pan, Dawy, Han, 2015) . Thus with the help of a platform mediated by IT organisers create a competition with set rules and rewards for competition. These TC platforms mostly attract as well as maintain special crowds who show liking towards special platforms(Brabham, 2013) . Another kind of crowdsourcing is Virtual Labour Markets (VLM) whish is also an IT-mediated markets in which the individuals render online services to be carried out anywhere, offered by the firms mainly with the help of micro-tasks thus indicating the production model of crowd sourcing in exchange of monetary compensation (Luz, Silva, Novais, 2015). Conclusion The above analysis indicates that crowdsourcing is a tool which makes use of IT mediated platform to engage the crowd for the purpose of task completion , production , generation of ideas or for problem solving , where the dispersed skills as well as knowledge of groups or individuals are leveraged with a mixture of innovative crowd derived inputs as well as processes that have top-down set goals as well as organisation initiatives. Crowdsourcing is an emerging field which is evolving. It encompasses various platforms like virtual labour markets (VLMs), Tournament crowdsourcing (TC) as well as Open collaboration (OC). Crowdfunding is a form of crowdsourcing and acts as a tool for financing for start-ups and is current and popular method. The financing gap that emerges in the start-ups can be easily bridged with the help of crowdfunding. Thus crowdfunding acts as a tool for raising funds for start-ups during the first financing rounds. AS far as the start-ups are capable of showing so me value to the crowds, crowd fund will be automatically being considered as financing option by entrepreneurs. Bibliography Bayus, B. (2013). Crowdsourcing new product ideas over time: An analysis of the Dell IdeaStorm community. Management science, 226-244. Brabham, D. (2013). Using Crowdsourcing in Government. IBM Center for The Business of Govt. Canarelli, M. (2017, Feb 22). Harness the Power of Crowdsourcing to Improve Your Business. Retrieved Oct 11, 2017, from Startupnation.com: https://startupnation.com/start-your-business/crowdsourcing-improve-business/ Cheung, S. (2012). How Companies Can Leverage Crowdsourcing. Composite Information Systems Laboratory (CISL). Lehdonvirta, V., Bright, J. (2015). Crowdsourcing for public policy and government. Policy Internet, 263-267. Leimeister, J., et al. (2009). Leveraging crowdsourcing: Activation-Supporting components for IT-based ideas competition. J. Manage. Inform. Syst., 197-224. Luz, N., Silva, N., Novais, P. (2015). A survey of task-oriented crowdsourcing. Artificial Intelligence Review, 187-213. Mergel, I. (2015). Open collaboration in the public sector: The case of social coding on GitHub. Government Information Quarterly, 464-472. Michel, F., Gil, Y., Hauder, M. (2015). A virtual crowdsourcing community for open collaboration in science processes. Americas Conference on Information Systems. ProfitBooks. (2017). 10 Funding Options To Raise Startup Capital For Your Business. Retrieved October 11, 2017, from https://www.profitbooks.net/funding-options-to-raise-startup-capital-for-your-business/ Prpi?, J., Shukla, P. (2013). The Theory of Crowd Capital. 46th Hawaii International Conference on System Sciences, . Computer Society Press. Sally. (2013). Cash from the Crowd: How to crowdfund your ideas and gain fans for your success. Enterprenuer Press. Smith, D., Manesh, M., Alshiakh, A. (2013). How Can Entrepreneurs Motivate Crowdsourcing Participants? Technology Innovation Management Review. Zhang, Y., Gu, Y., Song, L., Pan, M., Dawy, Z., Han, Z. (2015). Tournament Based Incentive Mechanism Designs for Mobile Crowdsourcing. IEEE Global Communications Conference, (pp. 1-6).

Theme for English B- Langston Hughes Essay Example

Theme for English B- Langston Hughes Essay While writing a paper for his English class, Langston Hughes, the only African American in the class, explores equality in a stream of conscious, three paragraph poem. In â€Å"Theme for English B,† Hughes expresses that all races influence each other and should be treated and considered equal as Americans. Hughes discusses the similarities between the different races in America and writes his paper questioning if â€Å"its that simple† to overcome segregation issues. After telling of his African American background, Hughes tells of his interests and hobbies. He likes simple and universal things such as eating, sleeping, drinking, working, reading, and learning. Hughes shares his interests to show that his likes are not weird or different from a typical Whites interests. Hughes shows the similarities because he believes that if two men appear to be the same, they should be equal no matter the color of their skin. If both a Black and White man like to learn, they should equate each other and be able to obtain the same schooling, according to Hughes. Hughes also mentions he likes to â€Å"understand life. His paper discusses life and his understanding of Americans as a race in itself, without a color determining how â€Å"American† a person is. His want to understand life shows Hughes urge to think deeper than the superficial meaning of things. However, in reality, Blacks and Whites did not have the same social status, hence Hughes question â€Å"I wonder if its that simple† to achieve equality. Hughes continues on and allude s to his music selection to show his credibility on the subject of segregation. He listens to â€Å"Bessie, bop, or Bach. Hughes listening to Bessie Smith, a Blues singer, shows Hughes African taste in music while Bach, a German composer, shows Hughes well cultured side. Hughes not only likes typical music stereotyped with his race, but music that would be considered â€Å"White† or â€Å"higher class† music. Hughes interest in Bach conveys that Hughes is educated and making insightful comments on how he views society and its racial problems. Hughes music choice helps add credibility to his paper. Hughes simply questions why unnecessary segregation exists in America when all races intertwine. We will write a custom essay sample on Theme for English B- Langston Hughes specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Theme for English B- Langston Hughes specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Theme for English B- Langston Hughes specifically for you FOR ONLY $16.38 $13.9/page Hire Writer Throughout the poem, Hughes familiarizes the races with one another. Hughes again intertwines races through his syntax in â€Å"I hear you: hear you, hear me we two you, me, talk on this page. † The repetition of words and consonants that sound alike causes the sentence to run together, as if to symbolize the different races â€Å"running together† as one. The syntax causes the reader to stumble and focus on the sentence. Hughes wants to show that he hears others and wants others to listen to him and the ideas he has. Both the Whites and himself â€Å"talk on [a] page† for this class and Hughes uses this to show the connection between the two. Hughes also says this to convey that the two races can â€Å"hear† each other. They do not speak different languages and can perfectly communicate with one another. Hughes shows the communication as another similarity between the two races, reiterating that the two should be equal. Hughes asks his teacher if his page will be colored like himself. He attempts to show his teacher the complications in ending segregation. Despite the fact that Hughes reveals all these truths about the similarities between the two races, his page will not be true and separation still exists. Hughes adds that his paper will â€Å"be a part of you, instructor,† telling his teacher that his paper has valuable lessons and significance. Hughes wants to influence his White teacher as a Black student, continuing the interracial learning as Hughes thinks this links â€Å"Americans† together and equal. The two races connect even though colors show differently. Hughes realizes that even though his page came â€Å"out of him,† it will not be true like his teacher said.

Free Essays on Effect Of Heredity And Environment

Effects of Heredity and Environment on individual Differences Most psychologists acknowledge that both heredity and environment are influential; the argument is over which factor is predominant The nature-nurture issue first became a controversy in the 1920's and the 1930's. Some psychologists felt that heredity was the primary, if not the sole, factor in the development of an individual. Others felt environment was the critical determining factor. As we saw in Unit One, this controversy is still unresolved. Still, most psychologists agree that some degree of interaction between heredity (nature) and environment (nurture) determines both physical and psychological development. In this module we will consider the relation of both factors to intelligence and behavior disorder. As you read the text, consider the following questions. Has heredity or environment made the greater contribution to your development? Are there any upper or lower limits of intellectual achievement? What research methods are used in heredity-environment studies? The interaction between heredity and environment can be studied by investigating families and persons who are related in various ways. Hereditary similarity is relatively well understood. A parent and child, for example, have 50% of their genes in common, but among siblings this may vary from 0 to 100% due to the random distribution of chromosomes. Identical twins have the same heredity; 100% of their chromosomes are alike. Environmental differences cannot be stated in such concrete terms. No two persons experience an identical environment. Very similar environments are usually experienced by same-sexed twins, whether identical or fraternal. Different-sexed twins, siblings, and parents all experience somewhat different environments, although these environments may be superficially similar. Occasionally, identical twins are reared apart. Then we have two people with identical here... Free Essays on Effect Of Heredity And Environment Free Essays on Effect Of Heredity And Environment Effects of Heredity and Environment on individual Differences Most psychologists acknowledge that both heredity and environment are influential; the argument is over which factor is predominant The nature-nurture issue first became a controversy in the 1920's and the 1930's. Some psychologists felt that heredity was the primary, if not the sole, factor in the development of an individual. Others felt environment was the critical determining factor. As we saw in Unit One, this controversy is still unresolved. Still, most psychologists agree that some degree of interaction between heredity (nature) and environment (nurture) determines both physical and psychological development. In this module we will consider the relation of both factors to intelligence and behavior disorder. As you read the text, consider the following questions. Has heredity or environment made the greater contribution to your development? Are there any upper or lower limits of intellectual achievement? What research methods are used in heredity-environment studies? The interaction between heredity and environment can be studied by investigating families and persons who are related in various ways. Hereditary similarity is relatively well understood. A parent and child, for example, have 50% of their genes in common, but among siblings this may vary from 0 to 100% due to the random distribution of chromosomes. Identical twins have the same heredity; 100% of their chromosomes are alike. Environmental differences cannot be stated in such concrete terms. No two persons experience an identical environment. Very similar environments are usually experienced by same-sexed twins, whether identical or fraternal. Different-sexed twins, siblings, and parents all experience somewhat different environments, although these environments may be superficially similar. Occasionally, identical twins are reared apart. Then we have two people with identical here...

Tort law undergraduate Essay Example | Topics and Well Written Essays - 1250 words

Tort law undergraduate - Essay Example One should be aware that this is another province in which the relationship among Human Rights Act and the common law principles will have to be worked out over periods of time. Further, the introduction of HR Act has not resulted in any major changes in the court’s outlook to the public official’s obligation at common law. (Lunney & Oliphant 2008: 530). In Van Colle case, the plaintiff’s son, who was likely to be a witness, in an ensuing criminal trial process, was under constant intimidation and threat which the police were aware as he had duly intimated to police about this, and the plaintiff’s son was murdered before the commencement of trial itself. Under Article 2 of the HRA, a claim was brought under the HRA for the infringement of the duties. (Lunney & Oliphant 2008:148). Thus , an action was initiated against the police for awarding compensation under the HRA 1998 , basing on a failure by the police as they failed to save the life of a citizen under police’s positive obligation under art .2 of ECHR and got a favourable verdict at first instance. The police appealed to the Court of Appeal, and it was unsuccessful and then made an appeal to House of Lords where the Lords gave the verdict in favour of police. In â€Å"Hill v Chief Constable of West Yorkshire†, (Harpwood 106), the decision of Houses of Lords was footed on public policy, which functioned as a watertight guard in civil claims for the police which resulted in a disproportionate bar on the privileges of individuals. (Harpwood 106). House of Lords was of the opinion that there was no fundamental for inflicting duties on the police as it would interrupt with the freedom of action which police is required when dealing with a grave crime(Harpwood 106). However, in Hill case, Lord Keith was of the view that police may be tortuously responsible to an

ITM422 - Administering IT Infrastructure - Mod 3 Case Assignment Essay

ITM422 - Administering IT Infrastructure - Mod 3 Case Assignment - Essay Example Companies are said to have overwhelming data if they begin to collect and store from external sources. Many organizations acquire huge data when they purchase information technology solutions and applications from external vendors. Researchers advise companies to have a database which is simple and user friendly (Lucker, 2005). It must also be properly organized and prepared which would allow the employees to access the information. It is necessary that the organization of the data be smooth which would assist the users in obtaining significance out of it. The smooth and simple organization of data from small projects can assist organizations in taking more complex projects. This will not lead to an abundance of data but it allows it to be organized in a simple, practical, and logical way. The data needs to be classified and categorized in a way which allows for the running of numerous applications (Lucker, 2005). It is also essential that database designers implement systems with fe atures that are beneficial for the organization. Many organizations are utilizing the technological innovations to manage data in a simple, organized and consistent way. The logging of data is performed to ensure that IT administrators can use it if there has been a security breach or event. Companies are increasingly using firewalls, UNIX, Windows servers, and other hardware to perform logging of data. Calpine is a company which deals with power and energy products (Higgins, 2005). The company not only logs its data but has also properly designed and evaluated it. Firewall analysis applications are being used as a smart way to find specific events (Higgins, 2005). The conventional method of finding specific events inside logs is very cumbersome and time consuming. Many vendors like Cisco offer technological solutions that are assisting companies in designing smart and simplified organizational data management processes. The increase in customers and automation of

Microorganisms in Nature and Biotechnology Essay

Microorganisms in Nature and Biotechnology - Essay Example This research will begin with the statement that a microorganism or microbe is an organism which is microscopic, usually too small to be seen by the naked eye. Microorganisms are very diverse including bacteria, fungi, archae, protists etc. They live in all parts of the biosphere where there is liquid water, including soil, hot springs, on the ocean floor, high in the atmosphere and deep inside the rocks within the Earth's crust. Microbes are critical to nutrient recycling in ecosystem, biochemical and ecological cycles. They also play a major role in precipitation and weather. Microbes are exploited in the fields of biotechnology, food technology, and genetic engineering. Even though most of the microorganisms are useful, a few are pathogenic too. A microorganism or microbe is an organism which is microscopic, usually too small to be seen by the naked eye. Microorganisms are very diverse including bacteria, fungi, archae, protists etc. They live in all parts of the biosphere where t here is liquid water, including soil, hot springs, on the ocean floor, high in the atmosphere and deep inside the rocks within the Earth's crust. Microbes are critical to nutrient recycling in ecosystem, biochemical and ecological cycles. They also play a major role in precipitation and weather. Microbes are exploited in the fields of biotechnology, food technology, and genetic engineering. Even though most of the microorganisms are useful, a few are pathogenic too. However, the recent developments of science have made the applications of microbes quite vital in the applied research of modern days.

Pomegranate Tree In The Kite Runner

Pomegranate Tree In The Kite Runner Khaled Hosseinis The Kite Runner is a novel that explores many important themes. Three such themes are violence, friendship, and the quest for redemption. Although Hosseini uses many techniques to depict these themes, one technique that stands out is his use of symbolism and imagery. Some of the symbolism and imagery he uses are key factors in the story. The pomegranate tree and the sacrifice of the sheep are effective forms of symbolism and imagery that enrich the themes of violence, friendship, and the quest for redemption. Although Hosseini reminds people of a peaceful Afghanistan, he also reveals the agony the nation faces after the Taliban came to power. Violence spreads throughout the story, everything from a harmless activity of kite flying to the rape of Hassan. The pomegranate tree reveals the violence occurring in the novel. The entire story circles around on an action of violence, Hassans rape, and Amirs pretending that Hassans rape never happened. In the novel, Amir wants Hassan to hit him with pomegranates to inflict pain and lessen his guilt; instead, Hassan smashes the pomegranates over his own head. This indicates that violence is the key to lessen the guilt; Amir believes a physical punishment will make Hassan release his pain and get rid of Amirs guilt. In the Quran, the pomegranate tree is spoken of as a fruit in the garden of paradise. At first it appears that way in the novel, but later as more violence occurs, the tree is barren and dead, meaning that paradise has fallen when the Tal iban took over. Afghanistan started to get destroyed and the Taliban kill whoever they like. This violence reflects todays world where people witness violence but walk away knowing they could have stopped it. There are many aspects of this theme many people can relate to everyday. Friendship in the novel is a recurring theme. Both the pomegranate tree and the sheep reveal the changes in the friendship throughout the novel. The friendship between Amir and Hassan is a key factor in the novel. While Amir and Hassan are young they carve their names into the pomegranate tree. Hassan says, One summer day, I used one of Alis kitchen knives to carve our names on it: Amir and Hassan, the sultans of Kabul. Those words made it formal: the tree was ours ( ). The tree symbolizes their relationship. Before the Taliban came to power there was less violence and the relationship was strong, but after the Taliban came to power, Afghanistan became more violent, and the healthy, green tree became dead and ruined, just like Amir and Hassans relationship. The social inequality in Afghanistan plays a key role as Amir begins to think of Hassan as a servant rather than a friend after the rape. Another example of the changes in friendship is shown by the sheep. In Muslims culture, the sacrifice of a sheep is meant to celebrate the faith of the prophet Ibrahim. This is similar to when Hassan, a pure boy is raped by Assef. The sheep symbolized the rape of Hassan because just like the sheep he was slain for the kite that Amir won. This made Amir feel guilty, which made him lose his connection with Hassan. Their friendship desecrated and Amir started to treat Hassan as a Hazara. Redemption is an essential part of the novel, since many sins are endured. When Hassan gets raped, Amir pretends nothing happened and starts feeling guilty. As children, Amir commits many sins, but Hassan takes the blame. The pomegranate tree was healthy and growing, but years later when Amir returns to Afghanistan, the tree is barren and dead, like their relationship. Amir feels guilty because he cant apologize for the rape of Hassan. He feels to redeem himself; he has to take care of Hassans son, Sohrab. Amir goes to great lengths to redeem himself; he gets beaten by the same bully that raped Hassan. This lessens his guilt, and makes him more committed towards taking care of Sohrab. In the story, Rahim Khan writes a letter to Amir; in the letter it says, I know that in the end, God will forgive Forgive your father if you can. Forgive me if you wish. But most important, forgive yourself( ). This is what pushes Amir to risk his life and go back to Afghanistan. He wants to be like his father, so he sets out to help Hassans son. This is like todays world, people make mistakes they go and try redeeming themselves. Anyone in the world can be placed in Amirs situation. In conclusion, the imagery and symbolism used in the novel effectively. The pomegranate tree showes the readers the change in Amir and Hassan`s relationship, whereas the sacrifice of the sheep showes the sins of Amir and how he tries to redeem himself. It enriches the novel and gives the readers a better understanding of the novel. The themes of violence, friendship, and the quest for redemption stands out, due to these techniques; of imagery and symbolism.

Evaluating Sources on Bulimia Nervosa :: essays research papers

Evaluating Articles on Long Term Bulimia Nervosa Effects   Ã‚  Ã‚  Ã‚  Ã‚  With the growing percentage of teen girls being treated and even more being diagnosed with Bulimia Nervosa, I decided to evaluate the multiple articles on effects and treatments for the disease. When searching bulimia pages and pages of links come up. To my surprise among the pages of links, I came across numerous pro-bulimia and pro-anorexia sites. However, the four websites I decided to evaluate were the first four search results that the titles really caught my attention with what I was really looking for. I based my evaluation on many different things from the credibility of the people writing the article or the magazine in which the article was published, how easy the information was to access and how helpful the information was in the way it was given.   Ã‚  Ã‚  Ã‚  Ã‚  The first article I evaluated was â€Å"Go Ask Alice† clip from a Columbia based newspaper. A young college girl wrote into the paper after being bulimic for over two years. She says she is currently being treated for 14 different cavities, one tooth, so decayed, it was barely even saved. Her salivary glands were swollen to where she looked like â€Å"a chipmunk† and she had been experiencing constipation. The reply back to the anonymous writer was a major warning and a very helpful source to people looking for the long term effects of bulimia nervosa. She emphasizes that most problems come from the vomiting which can eventually make you lose all your teeth. She warns how bulimia can mess with a persons blood potassium levels and drop it far enough that it disturbs the rhythm of the heart and cause sudden death. It can also bring chronic illnesses that may affect the heart, liver, gastrointestinal tract and neurological trouble. It backs all its info rmation with quotes and information from Doctors from universities. The article was very accessible and said right in its title, what it was talking about. An article like this, I believe, is very helpful for people researching this topic, especially if they are doing it for personal reasons, because it has someone writing that is bulimic talking about her symptoms and the trouble she is having.

Analysis of Chopin’s use of linguistic features in her literary works

From the Victorian era, Chopin startled critics with her paradigmatic tale of a woman’s abortive struggle towards independence in an oppressive society. By using women as her protagonist, Chopin highlights their sexist roles in literature whilst restricting them from the expansion necessary to deal with their realisation. It thus seemed conducive to transform the novel into a series of letters in the form of English Sonnets, establishing the undeveloped characterisation of Edna with Robert, whilst they are separated from each other. The transformation aims to elucidate Edna’s role in society, by satirizing the narrow and stereotypical way in which woman are commonly portrayed in literature. The novel as a form does not offer the opportunity for character development in the same way a series of letters/sonnets do. For example, Edna openly declares her love for Robert, at the time of her death: â€Å"I’m the person who deserves your love.† The continuous sense of the author’s evaluation of the moral choices that her characters make is lost; they seem more autonomous throughout the sonnets because they speak for themselves without Chopin’s explicit authorial presence. The sonnet form successfully mimics letter writing as both forms are addressed to someone, whilst informing and shedding light on their own thoughts. Moreover, when the two characters reveal their feelings to each other or reminisce of their time together at Grand Isle, the meter is tight, mirroring the natural sound of a heart beating. For example, Robert declares: â€Å"The bonds we made grew deeper than the sea.† This foreshadows events, making it clear to the reader the context of which the letter/sonnets are written, in the novel. As the final sonnet concludes, the iambic pentameter in the rhyming couplets deliberately fails, creating the sound of a dying and irregular heartbeat, phonetically indicating Edna’s death. Both lines thirteen and fourteen consist of eleven syllables, breaking the strict rule of including five iambs with one unstressed and stressed syllable, to make up the meter. Unlike the rest of the sonnets, the final is in past tense which suggests that she has already died and is looking back on her words to Robert. The fact that she dies simultaneously as the sonnet concludes, highlights the end of their communication and hence concludes the transformation through her tragic death. Phallogocentrism is a key attitude conveyed in Robert’s sonnets, particularly after he discovers that Edna only likes him to gain attention from her husband, whom she believes to be having an affair. For example, conventional values of gender roles are implied through this simile: â€Å"like a deceived husband not knowing you,† which aims to make Edna feel sympathy towards her husband, in an attempt to reduce her emotional desire for Robert, which contrastingly accentuates through the discourse of the transformation. In conclusion, the third sonnet uses juxtaposition of Edna’s beauty to highlight her cunning and manipulative ways as a female protagonist. This is revealed through the line: â€Å"For there can live no hatred on your face,† which highlights Edna’s surfaced, innocent faà §ade, concealing her inner desires, highlighting her non feminist attitude.

Impact of Inflation on Common Man Essay

* The banking industry produces some of the most lucrative profit margins around. If you are interested in starting your own bank then you need to be prepared for the fund-raising, organizing and form filing required to set one up. These steps will help make the process easier * Evaluate how practical it is for you to start a bank. Look at your business experience. You will need to have business management skills, financial management skills and fund-raising skills. * 2 Get to know your market. Before you start a bank you need to find a hole in your current market. After all people are not going to come to a start up bank if they can’t offer the customer something unique. If your local market is already saturated with banks consider moving your bank to an outlying area that is underserved by financial institutions, or consider starting an online bank. * Sponsored Links * Laser Marking Printers Print On Extremely Small Areas W/ High Speed And Print Quality! videojet.com/Free_Whitepaper * 3 Recruit professionals to head the board of your bank. Look for people who you can work well with, for people who have banking skills and experience and for people who have business management skills and experience. * 4 Research the requirements your state has for starting a bank. You can find this information at your state’s Department of Financial Institutions. * 5 Create a plan for raising the required capital funds for your bank. Search for investors, grant programs and ways to earn money to back your bank’s start up. Expect to be required to raise millions of dollars for your bank’s start up. California, for example, requires charter banks to have between $6 million and $10 million dollars in capital funds before their doors open. * 6 Download and fill out the required paperwork for starting a bank. These forms can be found online at your state’s Department of Financial Institutions’ website. This application packet will include a general information sheet, several questionnaires, financial reporting sheets and eligibility checklists. You will also be required to complete supplemental documentation to back up your request to start a bank. You may need to put together a proposal for your bank and you may also need to create a business plan. * 7 Wait for approval. This can take between several weeks and several months. * 8 Implement your business plan after getting approved by your state’s Department of Financial Institutions. Start your fundraising, look for a building, acquire insurance and bonding, hire employees and develop a marketing campaign. Sponsored Links Read more: How to Start a Bank | eHow.com http://www.ehow.com/how_2062432_start-bank.html#ixzz2KNFkFA2m

America the Grand essays

America the Grand essays "The population in the prison system of the US has doubled since nineteen eighty-five." ( System of a Down, The Prison Song, Toxicity.) It is things like this that make me feel that all is not well in America at the time being. It seems that America's patriotism has come back not soon enough after the events that took place on September eleventh, 2001. Even though; our prisons are crammed tight, people die daily, and rapes and other crimes take place continuously I still feel proud to be a citizen of the good ol' USA I am so proud to be an American that I will take up arms for this country if anything were to happen. To me, life in America is beautiful. We live in a country where we have so many rights and privileges. And yet; so many people take living in America for granted. I don't think that people realize what they have been given. Since; my birth I have been able to speak my mind freely without worrying about prosecution or worrying about getting my tongue cut out of my mouth. I have lived in a country without too much racism, or terror I feel that this is because our Declaration of Independence stated that "all men are created equal" (Thomas Jefferson, Declaration of Independence) and it makes people think that if they felt this way back then, than why can't we now. The privileges that people mainly take for granted are driving. People think that it is a right and that they deserve to be able to drive the way they want to. Another privilege that people take for granted is public education. In most other countries there is public education, kids are lucky if they e ven get any sort of education at all. There is more so don't get to comfortable. Maybe, public transportation here we have free rides to school or we can pay close to nothing to ride a bus for as long as we want to. We also have access to libraries in every town. Freedom of religion is practiced in the US also. We can believe...

Did the Framers of the constitution intend that a corporation be Research Paper

Did the Framers of the constitution intend that a corporation be classified as a person for the purpose of being sued and suing - Research Paper Example 208). Persons, according to Roman law, do not have any kind of existence outside that of the legal sphere, and the law recognizes entities, regardless of whether or not they have a biological status. This view is called the â€Å"fiction theory† – this means that the personality of a corporation is a fiction, and that the corporation owes its very existence to the state (French, 1979, p. 208). Rivaling this theory in American jurisprudence is that of the â€Å"Legal Aggregate Theory of the Corporation† – this means that the corporate body is a shield or an umbrella for the individual persons that make up that corporation. In this theory, biological status is what matters, and has legal priority. In this theory, the corporation is synonymous with the board of directors and other leaders of the companies, while employees are generally ignored (French, 1979, p. 209). Another competing theory is that of the Germans, who regard corporations as having a de jarte personality, â€Å"which the law only declares to be a judicial fact† (French, 1979, p. 209). ... What is needed is a Reality Theory that identifies a de facto metaphysical person not just a sociological entity† (French, 1979, p. 210) While these are the popular theories about corporate personhood, the focus of this paper is whether or not the Framers meant for a corporation to be considered a person for the purposes of suing and being sued is a question that has a confused answer. The answer is confused because Supreme Court decisions have contradictory analysis on whether or not a corporation is considered to be a person under the Constitution as written. One case indicated that a corporation can sue in its own name, but that the corporation itself is not a citizen, but, rather, is composed of individual citizens, and that these individual citizens are what a court must look to when deciding if a court has jurisdiction over corporation lawsuits. Another case says, no, a corporation is an entity of its own, and the individual members of the corporation are not what matters – what matters is the corporation itself. The differences between these two cases is that the former was a case involving corporate lawsuits and the latter involved a corporation’s ability to make contracts. Then along came a case whose dicta established that a corporation is a person, but did not give any kind of reasoning behind why it believes this to be so. Nevertheless, this is considered to be a landmark case in that the case affirmatively established that a corporation is indeed a person. But, since the reasoning behind this is unclear, it is likewise unclear as to whether this court decided that the Framers intended this to be so. In other words, the Supreme Court cases that have dealt with the issue of corporate personhood,

Self Analysis Leadership Profile Project Assignment

Self Analysis Leadership Profile Project - Assignment Example In the â€Å"EQ at a Glace† assessment, my total EQ (Emotional Quotient) score is 54 that belongs to the above average level that is 51-60. The five types of scores in this category were; Intrapersonal Components, Interpersonal Components, Adaptability Components, Stress Tolerance Components, and General Mood Components. The average of my Interpersonal Score is 3.6. The average of Interpersonal Score 3.3. The average score for the Adaptability was 3.3. My average General Mood, and Stress Tolerance Components were all 4. Both General Mood and Stress Tolerance Components scores were in the high range level. My dominant score for this assessment was Stress Tolerance Components. This indicates that I’m a self-driven person capable of tasks completion even under stressful conditions. I can work persistently even when there is dim optimism, I never give up. At the beginning of last semester, I had a lot of work juggling between family, work and study. I had signed up for a new course when I got a job promotion that required me to take up a lot of my time. This left me with no time for me or my family. However, I struggled persistently until I was able to balance my work, give my family quality time and still manage to get A’s for my course. The least dominant score for this assessment is Adaptability Components. I got a 3.3 for this assessment. I have difficulties adapting to different situations in the short run and this ends up wasting a lot of my time and resources. At the beginning of this course, my friends felt that I was much suited for it and will get great scores, but I was very pessimistic until I proved myself wrong by performing excellently. My action plan for this assessment will involve activities and a plan that will help me in better decision making that will enhance my self-motivation and increase my optimism. I will record all my tasks and activities I have