Blind Faith in Investing: The Martyrdom That Costs You
Oct 13, 2025
Ayn Rand warned us: sacrifice for its own sake is self-sabotage disguised as virtue. Yet, every day, investors play the martyr. They give up returns to fees, autonomy to managers, and agency to ritual. Pain becomes proof of devotion. The system whispers, “Endure now, salvation later,” and they obey. They cling to blind faith in investing, mistaking it for discipline—while their portfolios stagnate and their wealth silently erodes.
Han Feizi’s insight on systems fits perfectly: sacrifice is weaponized. Mutual funds demand obedience, not because it benefits the individual, but because it sustains the system. Fees fuel executives. Patience props underperformers. Faith keeps redemptions at bay. The investor becomes fodder for the machine. Questioning the process is treated not as skepticism, but as heresy.
This mirrors what Tactical Investor calls the **Burro Effect**: when enough people move together, they reinforce a behavior—buying, holding, or selling—regardless of logic. Sacrifice feels moral because everyone else is doing it. But morality doesn’t pay dividends. Awareness and strategy do.
The Rituals That Trap Investors
Rituals feel like discipline. Contribution days, quarterly reviews, annual reports—they all carry the weight of responsibility. But these aren’t strategies—they’re rites. Investors perform them not because they create value, but because they feel like diligence. The system rewards this obedience with comforting phrases: “Stay the course.” “Think long term.” “Markets always recover.” These words soothe, but they also sedate.
Consider the mutual fund investor paying 1–2% annually in fees. Over 30 years, that fee drag can reduce their ending portfolio by 20–40%. Yet they stay, chanting the liturgy of patience as if it were gospel. “Markets are volatile, but history rewards discipline,” the priest says. Translation: don’t question the church, don’t pull your money, just keep the faith. The system thrives on this inertia—on your inertia.
Han Feizi’s systems theory is clear: systems prioritize their own survival, not the individual. Mutual funds demand obedience because it keeps redemptions low, fees flowing, and underperformers afloat. Ritualised investing isn’t about building your wealth—it’s about sustaining the machine.
Blind Faith in Investing: Historical Receipts
If you doubt that blind faith in investing costs money, history has plenty of receipts:
– **2000–02:** The dot-com collapse punished investors who clung to “long-term growth” in tech stocks. Many lost 70–90%.
– **2008–09:** Faith in housing as a “safe” investment led to leveraged bets that wiped out portfolios. Liquidity buffers saved the disciplined.
– **2021–22:** Meme stock euphoria turned into collective martyrdom. “Diamond hands” believers held AMC and GameStop into the ground, while structured traders harvested volatility premiums.
In every cycle, blind faith in investing cost investors dearly. Rituals and faith don’t protect capital. Awareness and strategy do.
The Paradox of Faith and Discipline
Faith and discipline are critical in investing. They help you hold through volatility, trust in a long-term plan, and avoid impulsive decisions. But faith without awareness is blindness. Discipline without strategy is just glorified obedience.
The paradox is this: the same qualities that make you a good investor—patience, consistency, faith—can become liabilities when weaponized by the system. When you’re told to “stay the course,” ask yourself: **Whose course am I staying on?** Is it aligned with your financial goals, or just the system’s default inertia? Faith is only useful when paired with clarity. Without it, you’re not investing—you’re surrendering.
The Burro Effect: Herd Obedience Disguised as Strategy
The Tactical Investor calls it the **Burro Effect**: when enough people move together, their collective actions reinforce a behavior—buy, hold, or sell—regardless of logic. It’s mimetic contagion disguised as discipline. Social proof drives the herd: if everyone’s holding, so should you. If everyone’s buying, it must be right. Sacrifice feels moral because everyone else is doing it.
Platforms amplify this behavior. Reddit threads, Twitter noise, and dopamine-fueled trading apps don’t just reflect herd behavior—they accelerate it. Price action confirms the crowd’s moves, creating the illusion of logic and strategy. But logic is absent. The crowd isn’t investing—it’s reacting. Blind faith in investing thrives in this environment, where obedience replaces critical thinking.
Breaking the Trance: Awareness Over Ritual
Ritualised investing isn’t inherently wrong. Routine can stabilize behavior in volatile markets. The danger lies in mistaking ritual for strategy. To break the trance, you must replace passive obedience with deliberate, strategic awareness. Here’s how:
1. Write Prewritten Rules
The difference between a disciplined investor and a blind follower is a rulebook. Before any investment, write:
– **Thesis:** Why are you buying? One sentence.
– **Disconfirmers:** What would prove you wrong? List three.
– **Exit Plan:** Under what conditions do you sell? Price, time, or event triggers.
If you can’t answer these questions before entering a position, you’re not investing—you’re guessing.
2. Build a Five-Dial Dashboard
Replace noise with measurable states. A five-dial dashboard forces you to act based on conditions, not emotions:
– **Breadth:** Advancers/decliners, up/down volume.
– **Credit:** High-yield spreads and tone of cash bonds.
– **USD and Real Yields:** Direction and pace.
– **Volatility Term Structure:** Is the front month clenched or easing?
– **Leadership:** Who holds gains on red days?
Act only when three or more align. Otherwise, wait. Blind faith in investing reacts to stories; strategic discipline waits for states.
3. Audit Your Attention
Ritualised investing thrives on passive consumption. Quarterly calls, annual reports, generic headlines—they all lull you into complacency. Break the cycle with an attention diet:
– One price screen.
– One credit feed.
– One catalyst list.
Mute opinions that lack disconfirming evidence. Attention is collateral—guard it like cash.
4. Replace Rituals With Risk Audits
Quarterly performance reviews aren’t enough. Ask harder questions:
– What’s my top-ten concentration?
– How balanced is my sector exposure?
– Are valuations stretched?
– Can my liquidity plan handle a drawdown?
Ritualised investing focuses on outcomes; strategic investing focuses on risks.
The Final Cut
Blind faith in investing is hypnosis dressed as discipline. It rewards comfort over clarity, faith over strategy. Breaking the trance doesn’t mean abandoning routine—it means replacing passive rituals with deliberate systems. Write rules. Audit risks. Guard your attention.
The market will always test your patience. Faith alone won’t save you. Awareness will. Wake up. Stop surrendering to rituals. Start asking better questions. The crowd will always move on noise. Your job is to move on purpose.
