Herd Behavior and Investment in Financial Markets


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question 1 of 3

Today, some may say one of the benefits of systematic passive investing is the _____ . There is very little thinking that needs to be done.

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1. 'You should eat the bug, because everyone else is doing it.' This statement is an example of _____.

2. Politicians are susceptible to _____ because they often need to keep opinions that disagree with their party to themselves in order to keep their jobs.

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About This Quiz & Worksheet

Access the quiz and worksheet, so you can identify how much you know about the term herd behavior. Different financial terms are covered on the multiple-choice quiz.

Quiz & Worksheet Goals

The goal of these materials is to check your understanding of:

  • The first step to prevent herd behavior
  • Feeling peer-pressured to do something
  • Something politicians are susceptible to
  • A benefit of systematic passive investing

Skills Practiced

  • Reading comprehension - ensure that you draw the most important information from the lesson on herd behavior and investment in finance
  • Information recall - access the knowledge you have gained about an issue that arises if concern about reactions from others prevents an investment
  • Knowledge application - use your knowledge to answer questions about how herd behavior affects financial markets

Additional Learning

See what more you can learn about this topic by using the lesson called Herd Behavior and Investment in Financial Markets. Supplementary topics you can analyze thanks to this lesson include:

  • The meaning of herd behavior
  • Biases regarding financial investing
  • Ways to avoid herd behavior