Finfluencers are everywhere. They share portfolios, recommend strategies, post returns, and offer opinions on markets with the confidence of seasoned professionals. Some have millions of followers. Some have credentials. Some have neither.
The question is not whether finfluencers are good or bad. It is whether you have the tools to evaluate their claims. Because in a world where anyone can post anything, the burden of verification falls on you.
This article provides a framework for critically evaluating investment-related content online. It is not an attack on any individual or platform. It is a guide to asking the right questions before accepting claims that could influence your financial decisions.
This is general educational information, not personal financial advice.
The Structural Problem with Finfluencer Content#
Before examining specific claims, it helps to understand the structural dynamics that shape what finfluencers produce.
Incentive Conflicts#
Finfluencers do not typically earn money from your investment success. They earn money from:
- Audience size. More followers means more advertising revenue, sponsorships, and opportunities.
- Engagement. Content that generates clicks, shares, and comments is rewarded by algorithms. Nuanced, cautious content performs worse than bold, confident claims.
- Affiliate arrangements. Many finfluencers receive payments for promoting platforms, products, or services. These arrangements are sometimes disclosed, sometimes not.
- Selling access. Courses, memberships, and premium content generate direct revenue. The finfluencer's incentive is to convince you their knowledge is worth paying for.
None of these incentives require the finfluencer to be right. They require the finfluencer to be compelling.
This does not mean all finfluencers are dishonest. Many are genuinely trying to educate. But the system rewards attention, not accuracy. Understanding this helps calibrate how much weight to give any claim.
Survivorship Bias#
You see the finfluencers who succeeded. You do not see the thousands who tried, failed, and disappeared.
This creates a distorted picture. The visible population appears more skilled and successful than the underlying reality. The finfluencer with a large following is not necessarily more knowledgeable; they may simply be more persistent, more entertaining, or luckier in their timing.
Survivorship bias also affects the content itself. Finfluencers share their wins. They rarely share their losses with equal prominence. The portfolio you see is curated. The track record is selective.
The Dunning-Kruger Gradient#
Some finfluencers are highly qualified. Some are enthusiastic amateurs. Some are genuinely dangerous.
The problem is that confidence does not correlate with competence. The least qualified are often the most certain. The most qualified are often the most hedged. This inversion makes it difficult to judge expertise from presentation style alone.
A measured, uncertain tone is more likely to indicate genuine understanding than bold predictions and absolute certainty.
Red Flags in Finfluencer Content#
Certain patterns should trigger scepticism.
Cherry-Picked Time Periods#
"My portfolio is up 300% since 2020."
What happened before 2020? What happened during the 2022 decline? What is the performance over a full market cycle, including downturns?
Markets have good periods and bad periods. Anyone can look like a genius during a bull market. The test is whether the approach survives the full cycle.
When evaluating claims, ask:
- What is the starting date? Was it chosen to maximise the appearance of success?
- How does the performance compare during down markets?
- Is the time period long enough to be meaningful (at least 5-10 years for most strategies)?
Lack of Audited Records#
Finfluencers can claim any return. Screenshots can be edited. Partial positions can be shown. Paper trading can be presented as real money.
Audited track records are verified by independent third parties. They are standard practice for professional fund managers. They are almost never provided by finfluencers.
Without verification, you have no way to know whether claimed returns are:
- Actual or hypothetical
- Gross or net of fees and taxes
- Complete or selectively reported
- Achievable at scale or dependent on small position sizes
Treat unverified claims as entertainment, not evidence.
Returns Without Risk Disclosure#
"I made 50% last year" tells you nothing without knowing the risk taken.
A 50% return achieved through 5x leverage on a volatile asset is not comparable to a 50% return from a diversified portfolio. The former involves enormous risk of ruin; the latter does not.
Questions to ask:
- What was the maximum drawdown?
- Was leverage used?
- How concentrated was the portfolio?
- What would have happened if the market moved the other way?
Returns are half the story. Risk is the other half.
Guaranteed Outcomes#
"This strategy always works." "You cannot lose." "This is a sure thing."
Nothing in markets is guaranteed. Anyone claiming certainty is either lying or does not understand what they are talking about.
Legitimate educators explain probabilities, trade-offs, and conditions under which strategies fail. They do not promise outcomes.
Pressure to Act Quickly#
"You need to get in now." "This opportunity is closing." "Don't miss out."
Urgency is a manipulation tactic. Legitimate opportunities do not evaporate because you took a day to think.
Finfluencers who create urgency are often promoting something that benefits from your immediate action: affiliate signups, product launches, or positions they want to exit.
No Disclosure of Conflicts#
Australian law requires financial services providers to disclose conflicts of interest.¹ Finfluencers often operate outside this framework, either because they are not licensed or because they structure content to avoid regulatory triggers.
Questions to ask:
- Does the finfluencer hold positions in what they discuss?
- Are they paid to promote specific platforms or products?
- Do they receive affiliate commissions?
- Are any of these disclosed clearly?
Absence of disclosure does not prove conflict, but it should increase your scepticism.
Evaluating Finfluencer Credentials#
Credentials matter, but they are not sufficient.
Relevant Qualifications#
In Australia, providing personal financial advice requires an Australian Financial Services Licence (AFSL) or authorisation under one.² Finfluencers who provide general commentary (opinions, education) rather than personal recommendations may not need a licence, but the line between the two is often blurry.
You can verify whether someone holds a licence or authorisation through ASIC's registers.³
Relevant qualifications might include:
- CFA (Chartered Financial Analyst)
- CFP (Certified Financial Planner)
- Degrees in finance, economics, or related fields
- Professional experience at regulated institutions
What Credentials Do Not Guarantee#
Credentials indicate training and passing examinations. They do not guarantee:
- Skill at investing (many credentialed professionals underperform)
- Honesty
- Alignment of incentives with your interests
- Suitability of their advice for your circumstances
Credentials are a filter, not a guarantee. Treat them as one input among many.
What to Do If No Credentials Are Apparent#
Many finfluencers are self-taught enthusiasts. This is not inherently disqualifying, but it shifts the burden to the content itself.
Ask:
- Does the content demonstrate genuine understanding or superficial pattern-matching?
- Does the finfluencer acknowledge uncertainty and limitations?
- Is there evidence of ongoing learning and willingness to update views?
- Do they admit mistakes, or do failures disappear from the record?
Transparency as a Quality Signal#
The best finfluencers share more than just wins. Look for:
Full disclosure of positions. Before discussing an asset, do they disclose whether they own it?
Acknowledgment of losses. Do they discuss trades that went wrong, and what they learned?
Clear disclaimers. Do they distinguish between education and advice? Do they encourage independent verification?
Consistent methodology. Do they explain their process, or just their conclusions? Can you understand why they make decisions, not just what decisions they make?
Encouragement of scepticism. Do they welcome questions and push-back, or do they cultivate uncritical followers?
Transparency is not proof of quality, but its absence is a warning sign.
The Verification Habit#
Rather than evaluating each finfluencer individually, develop a general verification habit:
Check primary sources. If a finfluencer cites research, find the original paper. Read the abstract. Check whether the claim matches the finding.
Seek disconfirming views. Search for criticism of the strategy or claim. What do sceptics say? Are their objections addressed?
Compare to established knowledge. Does the claim align with established financial economics, or does it require believing that everyone else is wrong?
Test the logic. Does the argument make sense on its own terms? Are there logical gaps or unstated assumptions?
Wait before acting. Let the claim sit for a week. If it still seems valid after the urgency has faded, it may be worth considering.
When Finfluencer Content Is Valuable#
This article is not an argument against finfluencers. Some provide genuine value:
- Explaining concepts in accessible ways
- Democratising information that was previously gatekept
- Sharing diverse perspectives and experiences
- Creating communities for learning and discussion
The key is to consume finfluencer content critically, not passively. Treat it as one input among many, subject to verification and comparison. Do not outsource your decision-making to anyone, regardless of their follower count or apparent success.
Summary#
Finfluencer content is shaped by incentive structures that reward attention over accuracy: audience size, engagement, affiliate arrangements, and premium content sales. Survivorship bias means you see only those who succeeded or persisted; losses and failures are underrepresented. Red flags include cherry-picked time periods, lack of audited records, returns presented without risk disclosure, guaranteed outcomes, pressure to act quickly, and undisclosed conflicts. Credentials can be verified through ASIC's registers but do not guarantee skill or alignment with your interests. Transparency, acknowledgment of losses, clear methodology, and encouragement of scepticism are positive signals. The verification habit involves checking primary sources, seeking disconfirming views, testing logic, and waiting before acting. Finfluencer content can be valuable as one input among many, consumed critically rather than passively.
Sources#
- ASIC. (2024). Conflicts of interest. https://asic.gov.au/regulatory-resources/find-a-document/regulatory-guides/rg-181-licensing-managing-conflicts-of-interest/
- ASIC. (2024). Do I need an AFS licence? https://asic.gov.au/for-finance-professionals/afs-licensees/do-i-need-an-afs-licence/
- ASIC. (2024). Financial Advisers Register. https://asic.gov.au/online-services/search-asics-registers/