Abstract: American investing psychology originated in 1980’s. During the process of their research on investing activities, western economists found that many mathematic models of microeconomics and finance can’t satisfactorily explain and anticipate the investment in reality, therefore put more efforts on the research of human mind and behavior in investing, and achieved substantial results. Hence, Daniel Kahneman, the investing psychologist of Princeton University of America, was awarded the 2002’s Nobel Prize in Economics. In this paper, four research achievements of western investing psychology are described. They are Overreaction Theory, Prospect Theory, Regret Theory and Overconfidence Theory.

Key words: investing psychology, overreaction, prospect theory, regret theory, overconfidence