Unit Information
Unit code: BAO7007
Credit points: 12
This unit will contextualise behavioural finance theory to the practise of professional financial planning. Established and contemporary research will be explored to build deeper understanding of the motivations, fears, preferences, decision-making biases of clients and advisers. Behavioural finance theories will be used to learn communication techniques, negotiate client uncertainties, manage the ongoing client-adviser relationship and client literacy and financial literacy. Extending this, is an examination of efficient market theory to develop understanding of the irrationalities of investor behaviour and how it applies to client investment planning. The psychology of client engagement will be combined with behavioural finance to build interpersonal skills that empower client engagement and better negotiation of conflict. The content is supported by podcast interviews with practitioners, structured discussion and metacognitive interaction.
This unit is designed to meet the requirements of a Financial Adviser Standards and Ethics Authority [FASEA] bridging course and extend the meaning of a client’s wealth to include their behavioural bias for investment. Successful completion of this unit has the added advantage of satisfying the relevant FASEA education requirements of a bridging unit within an approved degree and may count towards the annual Continuing Professional Development (CPD) requirement to a maximum of 30 CPD hours per year.
On successful completion of this unit, students will be able to:
- Articulate behavioural finance theory and apply to the adviser’s fiduciary and best interest obligations.
- Adapt behavioural biases to providing professional financial planning advice and managing the client relationship.
- Explicate the implications of client literacy and financial literacy and different behavioural patterns on financial planning and decision-making.
- Evaluate efficient market theory and rationalise behaviourally modified approaches to investment planning advice.
Item | Assessment | Graded | LO Alignment | Grad Caps Alignment |
|---|---|---|---|---|
Assignment | Review of Behavioural Finance Theory and Contemporary Applications (500 words) | 10% | 1 | 1 |
Assignment | Integrating behavioural finance concepts into financial planning process and practice (2000 words) | 40% | 2 | 1 |
Case Study | Tailoring advice to clients’ financial literacy and investor preferences (2500 words) | 50% | 2, 3, 4 | 1 |
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