Oxford

The classical expected utility maximisation theory for financial asset allocation is premised on the assumption that human beings when facing risk make rational choices. The theory has been challenged by many observed and repeatable empirical patterns as well as a number of famous paradoxes and puzzles. The prospect theory in behavioural finance use cognitive psychological techniques to incorporate anomalies in human judgement into economic decision making. This lecture explains the interplay between risk and human judgement, and its impact on dynamic asset allocation via mathematically establishing and analysing a behavioural portfolio choice model.

The usual procedure to obtain uniqueness theorems for black hole space-times ("No Hair" Theorems) requires the construction of global coordinates for the domain of outer communications (intuitively: the region outside the black hole). Besides an heuristic argument by Carter and a few other failed attempts the existence of such a (global) coordinate system as been neglected, becoming a quite hairy hypothesis.

After a review of the basic aspects of causal theory and a brief discussion of the definition of black-hole we will show how to construct such coordinates focusing on the non-negativity of the "area function".