When it comes to protecting and growing wealth, just because a strategy is conventional doesn’t make its conservative. In Conservative Investors Sleep Well ,(featured in Common Stocks and Uncommon Profits and Other Writings) Philip Fisher pointed this out:
“Unfortunately, often there is so much confusion between acting conservatively and acting conventionally that for those truly determined to conserve their assets, this whole subject needs considerable untangling…
…Consequently to be a conservative investor, not one but two things are required of the investor of those whose recommendations he is following. The qualities desired in a conservative investment must be understood. Then a course of inquiry must be made to see if a particular investment so qualifies. Without both conditions being present the buyer of common stocks may be fortunate or unfortunate, conventional in his approach or unconventional, but he is not being conservative. ”
Their is of course intense pressure on people to conform. Keynes said its better for reputation to fail conventionally than to succeed unconventionally (although once a person is successful enough, this doesn’t seem to hold). In More Than You Know: Finding Financial Wisdom in Unconventional Places Michael Mauboussin discusses tensions between the “business of investing”(ie getting enough AUM to stay in business) and the “profession of investing”(doing whats truly best for your clients over the long term). History shows that often blindly following crowds can be hazardous to your wealth. If you want to preserve and grow wealth, you have to know when the crowd is being stupid.