Reality vs. Expectations

Some of my best and worst investment ideas came from navigating through social media. And I'm not entirely sure if that's a good or bad thing.

At a glance, my worst investment ideas are the ones I was easily sold on, precisely because they resonated with what I already thought were my principles and values.

The most recent one was Mocaverse, a project that embodied principles I personally valued. Such as ownership, creative empowerment, and building a reputation layer that bridges digital identity with real-world utility.

In this case, this project is fairly new, it hasn't proven itself yet or given enough time to "cook", so to speak.

But there are other cases where after reading through the docs, I realized I was nodding along without critically examining the fundamentals or even recognizing them.

And now, I question the validity of things that I resonate with so easily. But that's a topic for another day.

My best investment ideas, on the other hand, have a different flavor altogether.

I think it's a natural thing that we try to fit everything we come across into a mental box, so as to better categorize it into an already defined framework.

The problem arises when that thing doesn't quite fit into my existing framework.

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A practical example is this Biotech trend focusing on longevity science. I initially dismissed it as wishful thinking and was uncomfortable with both the ethical implications and investment thesis.

The Social Media Filter Bubble

The problem with finding investment ideas through social media isn't necessarily the platform itself, but how we interact with it.

It's commonly accepted that algorithms are designed to show us more of what we engage with, with a purpose of creating a filter/bubble that reinforces our existing beliefs and preferences.

In the investment world, this is very dangerous.

When everyone in your feed is bullish on the same assets and dissenting voices are filtered out by the algorithm or dogpiled by enthusiasts, you lose access to the full spectrum of information needed for sound decision-making.

I trick that I like to employ is use an alternate account to make research on the other side of the spectrum that's opposite to what I've already been fed by the algorithms.

The Validation We Seek vs. The Reality We Need

There's a deeper psychological component at play here, too.

When I seek investment advice on social media, what am I really looking for? Information, yes, but also validation.

Because I need confirmation that my thinking is sound or at least, that others share my perspective.

It can't be true that I'm the only one seeing this opportunity, or conversely, this risk.

Here, validation is more or less a security blanket against uncertainty.

But good investing also requires invalidation. Because reality doesn't care about validating our expectations and markets don't move based on what would make us feel good about our worldview.

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In my investment strategy, I've started implementing some concrete practices:

• Following thoughtful critics of assets I'm bullish on(hard to find, the bubble is ever expanding like a plague).
• Setting aside time to consider the strongest arguments against my investment theses(better to do it with an accountability partner).
• Being wary of communities with no tolerance for skepticism or doubt(tribalism is a double edged sword).
• Distinguishing between analysis and cheerleading(yes, wagmi is both real and unreal).

A Work in Progress

I don't have this figured out entirely. I still find myself drawn to narratives that confirm my biases and feel the pull of wanting to be right rather than accurate.

Of course, awareness is the first step, always to solving these issues of seeking validation at the expense of accuracy and good decision-making.

Then, recognizing the gap between reality and our expectation gives us at least a fighting chance to make better decisions.

This can be done through measuring how social media mostly widens or narrows that gap.

Social media isn't reality, true. But it has an uncanny ability to mirror aspects of reality that we are primed to see.

A magnifying glass or a distortion lens for our existing perception of reality.


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