Humans are curious creatures. We like to regard ourselves as being internally consistent while the reality is far messier. For evidence, look no further than our investments.
Or as the artist formerly known as Dr. Moneyblogs is fond of quoting:
Don't tell me what you think. Tell me what you have in your portfolio.
-Nassim Nicholas Taleb
Many personal finance writers, bloggers and podcasters suggest that one's portfolio contain no more than 10% "fun money," a catch-all intended to accommodate the idiosyncracies of human nature by permitting an otherwise rational portfolio to contain some element of the irrational.
I get it.
You are a passive index fund investor who does not believe in individual stock picking...except for those shares of Tesla you picked up because you really believe Elon Musk is a crazed genius.
You never bothered to read up on the blockchain revolution...but your friend paid his daughter's university tuition with appreciated shares of bitcoin, so you invested a few grand as well, just in case.
An old J.P Morgan saying comes to mind: Nothing so undermines your financial judgement as the sight of your neighbor getting rich.
I'll be the first to admit I observe my own forms of crazy.
I used to wake up at dawn and stand in line every few months to have first crack at the REI Garage Sales that offered used gear at significantly reduced prices.
My wife and I once escaped for a weekend in Vegas based around the fact that Southwest was offering promotional fares from LA for 19.99 each way.
I succumb to irrational temptations more than I'd like to admit; I possess and recognize our shared human frailties.
I just try not to do it in my portfolio - those dollars have specific job descriptions, and they don't get to slack off as long as they're working for me.