Question

When investors trade on the same side of the market in the same securities, or when investors ignore their own private information and/or analysis and act as other investors do:

a) Efficient market behavior
b) Rational behavior
c) Herd behavior
d) Contrarian behavior

Answer 1

The correct answer is herd behavior.

Step-by-step explanation:

The correct answer to the question is c) herd behavior. When investors trade on the same side of the market in the same securities or ignore their own private information and analysis to follow what other investors are doing, it is known as herd behavior. This behavior is characterized by investors copying the actions of others, often leading to the formation of bubbles or crashes in the market.