At Rasiah Private Wealth Management, we often talk about the importance of having a thoughtful, disciplined investment strategy. Unfortunately, it’s all too easy to get distracted by stories of overnight success and quick riches. But here’s the truth: relying on hope isn’t a strategy—it's gambling.

In a recent newsletter, financial author Carl Richards humorously (but accurately) highlighted a concept he calls "Pretend Investor Disease" (PID). While amusingly presented, PID reflects a serious financial risk that can lead investors to make decisions based solely on the hope that a certain asset’s value will continue to rise.

Let's unpack this a bit further:

Recognising 'Pretend Investor Disease' (PID)

PID typically appears as a desire to buy investments without rational, thoughtful analysis, purely because you expect someone else to buy them later at a higher price. Carl refers to this risky habit as “The Greater Fool Theory”, an approach that has underpinned countless investment bubbles and financial collapses. Think about Ponzi schemes, speculative bubbles, or fad investments driven by social media trends. These are classic examples.

Symptoms of PID

Ask yourself if you've ever thought:

• “I’ll just buy this now—it’s bound to go higher.”

• “Everyone’s buying it; it must be a good investment.”

• “I heard a tip that this stock will skyrocket.”

If so, you may be at risk. PID thrives on insider tips, social media hashtags, and hot investment trends. It’s dangerously contagious, spreading rapidly through casual conversations, online forums, and misleading investment newsletters.

Protecting Yourself from PID

Fortunately, there’s a straightforward way to protect yourself and your wealth from PID: have a clear, disciplined, and values-based investment strategy. Here’s how you can stay safe:

1. Stop and Reflect: Before acting on an impulse, pause and ask yourself, “Does this align with my long-term financial goals and my values?”

2. Don’t Follow the Crowd: Investing isn’t a popularity contest. Just because something is trending doesn’t mean it’s right for you.

3. Get Professional Advice: Speak to a qualified financial adviser. Professional guidance helps you remain objective, focused, and aligned with your real financial goals.

The Bottom Line

While you might occasionally see someone achieve short-term success from speculative, hope-based investing, remember: for every lucky winner, there are many more who suffer financial losses.

At Rasiah Private Wealth Management, we’re committed to helping you build a sound, evidence-based financial plan that matches your life’s values and goals, not just a fleeting hope of quick profits.

Invest wisely. Hope alone isn’t enough—discipline, strategy, and clarity are the real keys to financial well-being.

As always, we’re here to help you stay vigilant and achieve long-term financial confidence and peace of mind.