'FOMO finance': When investing becomes performative

Summary: From flashy stock picks to portfolio “flexing”, social investing is shaping how many investors behave and not always for the better. This story unpacks the hidden biases creeping into your portfolio, from herding to FOMO. Here’s how to watch out for them.

The new tribe of financial influencers (or “finfluencers”) are rebranding money as an aesthetic. They’re sipping turmeric lattes in Santorini while explaining asset allocation. They’re walking Cannes red carpets not because it does anything for your investing habits but because visibility is their currency. All in linen co-ords, probably sponsored.

Investing, once a disciplined, deeply private act, has become... content. And everyone’s a main character. It has now become social signalling. And yes, we have a term for it: social investing.

Social investing is when investors take cues from peers rather than fundamentals. Decisions here are performative, based on social cues and groupthink, not data. You’re not buying that mid-cap stock because it’s undervalued; you’re buying it because Rohan from Instagram made a reel about it in his Porsche.

The biases beneath the bling

This trend supercharges some of the market’s most dangerous biases:

1) Herd behaviour: Following the crowd, even when your own research suggests otherwise. As economist Abhijeet Banerjee showed in a 1992 study, this bias occurs when people abandon private judgement to mimic others. This manifests as everyone piling into the same buzzing small-cap or blindly applying for IPOs because “everyone in office got it”. Because who wants to be the only one not flexing on Monday?

2) Overconfidence bias: This is when investors, flush with a few early wins, start believing they have some sixth sense for markets. Finance professor Terrance Odean in his 1998 paper showed that overconfident investors overtrade and underperform, convinced they can time markets better than the rest. On social media, this gets accelerated. A few green screenshots and suddenly you’re a self-declared "market maven", doling out advice with a “Pro Tip” in bold font.

3) Recency bias: Amos Tversky and Daniel Kahneman in 1974 noted our tendency to give more weightage to recent outcomes and expect them to repeat, ignoring longer-term averages or cyclical risks. On social media, this gets magnified because every post, every reel, every success story is current (and carefully curated). The past looks like the future because you are only shown the highs.

Why we fall prey to these biases

Like everything else in life, investing biases may trace back to the human desire to feel in control. Freudian theory would argue that the ego seeks mastery over the environment to avert anxiety, and investing, for many, becomes the adult playground where this illusion plays out.

Investing, then, becomes an arena where we seek not just returns, but reassurance, giving way to the above biases. You think you are managing money but you are essentially trying to have control over uncertainty.

The master bias: FOMO

FOMO or Fear of Missing Out is not just an internet-era meme. It triggers every other bias we’ve discussed. It fuels herding (you join in). It inflates overconfidence (you believe you can time it). It feeds recency bias (you think it will continue). The more you have FOMO, the less you take decisions based on your needs and goals. Instead of planning, you react. FOMO converts investing from a rational process into an emotional reflex. And like all reflexes, it's hard to control and easy to exploit.

Even finfluencers aren’t immune

Here’s the twist: those who sell FOMO feel it too. To keep engagement up, many perform—flashing bags, bragging on podcasts. Even losses become curated, usually as “learnings”. The social capital of money-talk replaces actual financial rigour. In this economy of appearances, they dance to the algorithm’s tune. And their followers get caught in this loop of mimicry and aspiration, chasing rally after rally,

Noise or navigation?

If your money is dancing to someone else’s music, don’t be surprised when you miss the beat. Investing isn’t controlled through constant activity; it’s clarity through discipline. Your portfolio needs to reflect your own personal financial needs, not trends. And that’s exactly what the Value Research Portfolio Tracker is designed to be—your antidote to the market’s noisiest tricks.

Track, don’t perform

Our Portfolio tool can help you overcome every bias we’ve just unpacked by letting you detect overlaps, evaluate fund performance and stay diversified.

• When herd behaviour tempts you into crowded trades, the tool shows whether you’re genuinely diversified or just shadowing the crowd.
• When overconfidence convinces you that a few wins make you invincible, it cuts through the bravado with your actual performance.
• When recency bias tricks you into extrapolating yesterday’s rally, it forces a longer lens—reminding you of cycles, averages and the weight of time.

Instead of portfolios shaped by FOMO and social media feeds, you get to create a portfolio that reflects your own needs. That’s the difference between imitating every reel and building wealth that lasts.

You don’t need a Cannes invite or a Canva reel to be a successful investor. You need clarity, consistency and a tool that keeps your portfolio honest.

Try Portfolio tool

Also read: Your portfolio called. It's tired of all its exes.

This article was originally published on August 27, 2025.