This title provides a new, evolutionary explanation of markets and investor behavior. Half of all Americans have money in the stock market, yet economists can't agree on whether investors and markets are rational and efficient, as modern financial theory assumes, or irrational and inefficient, as behavioral economists believe - and the value or futility of investment management and financial regulation hangs on the answer. This book suggests a new framework in which rationality and irrationality coexist-the Adaptive Markets Hypothesis. Drawing on psychology, evolutionary biology, neuroscience, AI, and other fields, it shows that the theory of market efficiency is incomplete. When markets are unstable, investors react instinctively, creating inefficiencies for others to exploit. This new paradigm explains how financial evolution shapes behavior and markets at the speed of thought-shown by swings between stability and crisis, profit and loss, and innovation and regulation.