Don’t follow the crowd. The conventional wisdom is oftenwrong. One day, the entire investment world thinks that thepharmaceutical industry is near death. A little later, the entireinvestment world thinks the pharmaceutical industry is a cureall.Fisher remembers when Wall Street was sure that a depressionwould occur after World War II. It turned out to be a“mass delusion.”Recognizing that the majority opinion can be just plainwrong can “bring rich rewards in the field of common stocks.”It’s hard psychologically to buck the crowd, of course. But itwill help if you recognize that the financial community is usuallyslow in acknowledging that something has changed drastically.(Almost all of us, in fact, feel the pain of “cognitivedissonance” when we must change our views because of powerfulevidence to the contrary.)• Don’t overstress diversification. It’s true that every investorwill make mistakes, and if you have a reasonably diversifiedportfolio, an occasional mistake won’t prove crippling. But investorsshould not try to own the most but the best.Diversification is such an honorable word that investorsaren’t aware enough of the evils of being overdiversified. Youmay wind up with so many securities that you cannot monitorthem adequately. Owning companies you aren’t familiar enoughwith may be even more reckless than not having a well-diversifiedportfolio. How many stocks did Fisher think was too many?If you have only $250,000 to $500,000, he thought that as manyas 25 was “appalling.”