Mental Accounting

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Mental Accounting

A concept stating that investors and people divide up their current and future assets into different categories. These categories may be roughly thought of as "safety capital," which one uses to fulfill personal needs and make low-risk investments, and "risk capital," which one uses for high-risk transactions. Mental accounting is important to understanding certain investment decisions: rather than treating each unit of money as if it were exactly the same, people generally assign it into what they need and what they do not need. This effectively turns money, which is fungible, into something that is not fungible. See also: Behavioral economics.

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No references found			s used in behavioral economics called mental accounting. Top 5 Mistakes Women Make with Money by Beth And Jim Hood / Women's issues/gender studies community Mental Accounting Effect: You should have a diversified portfolio of different assets - stocks, bonds, property, commodities, cash etc so that portfolio risk is reduced. There are no rational investors by Gulf News (United Arab Emirates) Classical models predict that the division of stock returns into dividends and capital appreciation does not affect investor consumption patterns, while mental accounting and other economic frictions predict that investors are more likely to consume from stock returns in the form of dividends. Behavioral Finance by NBER Reporter			Medium-Term Financial Strategy Medium-Term Guarantee Program Medium-Term Note Medium-Term Note Retail meeting of the minds Meff Renta Fija Meff Renta Variable Mega Cap megalopolis Mei Moses World All Art Index Melbourne Mint Mello Roo Melon Melting Member Member Bank Member Firm Member of Household Member Short Sale Ratio Membership Membership or a seat on the exchange Memorandum Memorandum of Understanding Memoria menace Mental Accounting Mental Health Parity Act of 1996 Menu Merc Merc, The Mercaderia Mercado Mercado a futuro Mercado a termo Mercado activo Mercado alcista Mercado angosto Mercado bajista Mercado bursatil Mercado cambiario Mercado chato Mercado contado Mercado de capitales Mercado de compradores Mercado de dinero Mercado de eurobonos Mercado de eurobonus mercado de futures de productos Mercado de futuros Mercado de opciones Mercado de operaciones al mejor postor			mensurative menswear Menswear (band) Ment Ment ment- Mentagra Mentagra Mentagra mental mental mental mental mental Mental & Nervous Mental (disambiguation) Mental (disambiguation) Mental (disambiguation) Mental (disambiguation) mental 1 mental 2 mental aberration mental aberration mental aberration mental aberration mental ability mental ability mental abnormality Mental Abuse to Humans Mental Abuse towards Humans Mental Accounting mental acuteness mental adjustment Mental Adjustment to Cancer Questionnaire Mental After Care Association mental age mental age mental age mental age mental age mental age mental ages mental ages mental ages Mental Agitation mental agony Mental alienation Mental alienation mental and spiritual makeup mental anguish mental anguish Mental arithmetic mental artery mental artery mental artery mental artery Mental asylum Mental asylum Mental asylum mental attitude mental attitude

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