Section B Answer BOTH questions from this section 3. (1) Emma is a software developer and lives in London. Her portfolio of equity investments consists only of stocks of firms based in the UK. If you were investing, would you follow a similar approach? Discuss this kind of investor behaviour and the relevant empirical evidence. (40 Marks) () John makes the following statements during a discussion of his financial plans with an investment adviser. (a) I use the internet extensively to research the stock market every day, and I believe now is the best time to invest in the energy industry (b) I have earned good return from investing in the stock of company ABC over the last year, and I am sure it will be a better performer in the future. (c) I do not want to sell the stock for a price lower than I bought it. Identify and explain concepts of behavioural finance consistent with the statements. Do you think that these concepts have much impact on investor behaviour in the real world? (60 Marks) (Total 100 Marks) Section B Answer BOTH questions from this section 3. (1) Emma is a software developer and lives in London. Her portfolio of equity investments consists only of stocks of firms based in the UK. If you were investing, would you follow a similar approach? Discuss this kind of investor behaviour and the relevant empirical evidence. (40 Marks) () John makes the following statements during a discussion of his financial plans with an investment adviser. (a) I use the internet extensively to research the stock market every day, and I believe now is the best time to invest in the energy industry (b) I have earned good return from investing in the stock of company ABC over the last year, and I am sure it will be a better performer in the future. (c) I do not want to sell the stock for a price lower than I bought it. Identify and explain concepts of behavioural finance consistent with the statements. Do you think that these concepts have much impact on investor behaviour in the real world? (60 Marks) (Total 100 Marks)