Behavioral Finance in the Digital Era

The digital era has revolutionized nearly every aspect of financial markets, from how investors interact with financial instruments to how trades are executed. Behavioral finance, a field that explores how psychological factors influence financial decision-making, must now consider the profound impact of digital technologies. As financial technology (FinTech) platforms, social media, and algorithmic trading gain prominence, understanding investor behavior in the digital age becomes increasingly crucial. This chapter examines the role of digital advancements in shaping behavioral biases and market psychology, and their implications for both individual investors and the broader financial system.