What Is Jekyll and Hyde?

The phrase "Jekyll and Hyde" employs a literary reference to describe a stock market that appears to have a split personality, mixing good and bad character traits.

Jekyll represents the good in a market. It is benign, predictable, and conducive to trading gains. Hyde is a bad character﷽ who is volatile, unstable, unpredictable, and generally dangerཧous to investors.

Because the stock market is susceptible to the full range o♐f human emotions, Jekyll and Hyde m🐽ake frequent appearances on Wall Street.

Understanding Jekyll and Hyde

In Robert Louis Stevenson's The Strange Case of Dr. Jekyll and Mr. Hyde, Dr. Jekyll, a decent and congenial scientist, unleashes his dark side, Mr. Hyde, through unwise experimentation on himself in a laboratory. Although Jekyll and Hyde have contradictory natures, they are one and 🥀the same person.

The embodiment of good and evil in one man is at times paralleled in the stock market. A calm and predictable market can suddenly and inexplicably be torn apart by a frenzy of negativity. Like the characters in Stevenson's novel, market participants and observers are left baffled about this strange behavior and at a loss to explain its underlying causes.

Evolution of Behavioral Finance

An economist would say that strange market behavior is at odds with the efficient market hypothesis, which maintains that the price of any stock at any given time ಞwill always be the same as its fair market value because it will be based on all of the information then avai🌄lable.

A relatively new field of theory, 澳洲幸运5官方开奖结果体彩网:behavioral finance, attempts to explain how rational decision-making, or a lack of it, contributes to manic swings in a market. Collective human behavior connected to greedജ and feaꦰr causes bubbles to form and then suddenly pop.

The Jekyll and Hyde syndrꦏome might illustrate🌌 an aspect of behavioral finance.