Multi-factor models have been popularly used to explainasset market behavior. The Fama and French three-factor modelfitted on the sample set of new economy stocks for the studyperiod of late nineties to early 2000s, however, fails to giveadequate explanation of the stock market behavior. A behavioralmodel built on the assumption of bounded rationality and biases ininvestor behavior seems to offer a better explanation of the stockprice behavior.
