Group Project

Programme Bachelor of Business

Course BU8305 Behavioural Finance
Assessment Group Project
Number of Three
students per
group
Weight 30% of total final grade
LO assessed 1. Demonstrate a critical knowledge of the differences between a
Behavioural Finance perspective and a traditional finance perspective.
2. Use appropriate 'debiasing' techniques to improve investment
performance in a range of business contexts.
3. Use a range of approaches to develop effective corporate governance
mechanisms to reduce negative consequences of irrational financial
decision making.
Submission th
28 May 2021, at 4 pm on Moodle Turnitin.
Length 5000 words (+/- 10%), excluding the cover page and references.
Penalty According to institutional policy, late submission will result in a 5% reduction
from total marks.

Learning Outcomes based on Assessment tasks.

Questions Learning outcomes Marks
1 1 10
2 1 15
3 1 15
4 2 25
5 2, 3 25
6 10
Total 100

Aim of this project.

To give students the opportunity to evaluate the assumptions of JP Morgan's investment
philosophy, to consider the sources of competitive advantage in investing in securities and
marketing financial products, the various dimensions of investor psychology, and the principles of
Behavioural Finance.
 Case situation
Following a successful model in Europe, JP Morgan has introduced a set of five U.S. retail mutual
funds with an investment philosophy and marketing strategy grounded in Behavioural Finance.
The asset management group believes that understanding investor biases like overconfidence,
anchoring, and loss aversion is key to generating returns on the investment side and educating
clients on the advisory side.
The Asset Management unit at JP Morgan had been a pioneer in “Behavioural Finance”. JP Morgan
had over 25 years of experience in behavioural investing since 1992 when it offered an initial retail
product in UK (Fuller and Thaler Funds).
Since the late 1990’s, JP Morgan offered a wider range of mutual funds in UK and Europe and
began to focus on the larger US market. The well documented behavioural biases created
opportunities for JP Morgan Investments managers seems to be reflected on retail investors.
JP Morgan Behavioural Finance products provided a confirmation for a concept that been
successfully applied internationally. The “Investor Psychology” played a major role in branding
these products.
Reference:
https://hbsp.harvard.edu/product/207084-PDF-
ENG?Ntt=BEHAVIOURAL+FINANCE%2C+JP+MORGAN&itemFindingMethod=Search
Assessment Tasks
Respond to the questions outlined below with all valid facts and figures. When the situation
demands, use graphs or charts to validate your answer.

1- Explain how traditional Mutual funds differ from Behavioural Finance Mutual Funds.
2- Draft a basic profile of JP Morgan Asset Management Behavioural Finance strategies.
(hint: focusing on JP Morgan Intrepid funds)
3- Discuss and comment on JP Morgan Intrepid Funds performance during pre and post 2008
financial crisis.
4- Discuss the “Behavioural Biases” and analyze how it is used in JP Morgan Intrepid Funds to
improve the investment decisions.
5- Reference to the above, do you recommend offering Behavioural Finance mutual funds in
the GCC region? Why?
6- References, citation, and grammar in content writing
 Marking scheme

Criteria Marks
Traditional finance Vs Behavioural finance mutual funds 10
Basic profile of JP Morgan Asset Management Behavioural Finance strategies 15
JP Morgan Intrepid funds’ performance during pre and post financial crisis 15
Behavioural Biases 25
Behavioural finance mutual funds in the GCC 25
References, citation, and grammar 10
Total 100

RUBRICS

Criteria Key factors to be 85-100% 70-84% 60-69% 0-59%

considered Excellent Good Adequate Inadequate
Explain how Thorough Rigorously Demonstrated Demonstrated No serious
traditional explanation of demonstrated good some differences attempt on
Mutual funds Traditional the differences understanding of between identifying and
differ from Mutual Funds Vs between traditional MFs traditional developing the
Behavioural Behavioural traditional MFs and Behavioural finance and differences
Finance Finance Mutual and Behavioural Finance MFs in Behavioural between
Mutual Funds with facts Finance MFs with general. Finance MFs but traditional MFs
Funds. (10%) facts. not fully. and Behavioural
Finance MFs.
Draft a basic Identification of Coherent Good discussion Demonstrated No serious
profile of JP proper Asset discussion of of basic profile of limited ability in attempt on
Morgan Asset Management asset JP Morgan Asset drafting a basic drafting a basic
Management Behavioural management Management profile of JP profile of JP
Behavioural Finance Behavioural Behavioural Morgan asset Morgan asset
Finance strategies of JP Finance Finance management management
strategies. Morgan. strategies of JP strategies Behavioural Behavioural
(hint: focusing Morgan. Finance Finance strategies
on JP Morgan strategies
Intrepid
funds) (15%)
Discuss and Meaningful Exceptionally well Good discussion Demonstrated No serious
comment on analysis and written, on JP Morgan limited ability in attempt on
JP Morgan conclusion based illustrated, Intrepid Funds commenting on commenting JP
Intrepid on facts and polished and performance JP Morgan Morgan Intrepid
Funds figures. fluent based on during pre and Intrepid Funds Funds
performance facts and figures. post 2008 performance performance
during pre financial crisis to during pre and during pre and
and post some extent.
2008 financial post 2008 post 2008 financial
crisis. (15%) financial crisis crisis
Discuss the Extent, depth, Integrated critical Demonstrated Limited ability to No serious
“Behavioural currency of analysis in good analysis handle the attempt on data
Biases” and literature review literature and with sound situation and to analysis,
analyze how and referencing. theory adopted evaluation of the summarize the interpretation, and
it is used in JP Handling of situation findings. conclusion
Morgan concepts, prevailing in JP
Intrepid models, and Morgan
Funds to theories
improve the
investment
decisions.
(25%)
Reference to Defense of Excellent Good Demonstrated No serious attempt
the above, do chosen Recommendation recommendation limited ability to on doing a critical
you methodology based on well has given but make analysis and giving
recommend and clear structured critical without recommendation recommendation
offering recommendation analysis by elaborating fully by carrying out a subsequently
Behavioural considering pros on pros and cons thorough in-
Finance and cons of the of the given depth critical
mutual funds given situation. situation. analysis of the
in the GCC given situation
region? Why?
(25%)
References, Style of Excellent range of A good range of A small number No references/
citation, and referencing, references and specifically of relevant and citations and
grammar citation, and citations- relevant and correctly partial use of APA
(10%) grammar within correctly correctly formatted referencing with a
the project. formatted. formatted references and lot of grammatical
Displays a level of references and citations with errors in the
professionalism citations with some content writing.
and good grammar in grammatical
demonstrated the content errors in the
outstanding writing. content writing.
grammar in the
content writing.

Prepared by:
Dr. Manju Babu
Assistant Professor, Banking and Finance