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In my personal experience, I see two groups of "losers". One group that attributes their success entirely to skill. Another that attributes the success of others entirely to luck. Neither achieve much in the long run only talk a lot.
I don't know anybody who has achieved anything of significance attribute all of it to luck or all of it to skills.
We make our own luck with our skills in that we stack the odds in our favor in a probabilistic world using our skills to the extent we can. Some are more skilled than others and some are more fortunate than others.
That is how we make our careers, our relationships and our achievements. Does anyone feel any different?
Thank you Ted for keeping the Luck discussion alive. It is a fascinating topic that does have a first-order influence and impact on investing outcomes.
I mostly agree with c-man’s assertion that “We make our own luck with our skills in that we stack the odds in our favor in a probabilistic world using our skills to the extent we can. Some are more skilled than others and some are more fortunate than others.”
It is indeed a probabilistic world with the future a cloudy uncertainty. Therefore, in my postings I continually emphasize the scientific experimental method of collecting real data, organizing that data in a statistical manner, and then making a decision based on analyses of that data bounded by our preferences and constraints.
I have never known a successful person who attributes 100 % of his success to skill. All acknowledge the incursion of a Luck Factor. On the other side of that equation, I have known folks who attribute 100 % of their many failures to being unlucky. The two groupings are very asymmetric in their self-evaluation. I’m not shocked by this observation. Some people find an accurate self-assessment an undoable challenge.
I do believe that anyone’s position on the luck spectrum can be improved. Working to develop positive factors like adaptability, resilience, tenacity, education, out-of-box-thinking, and goal setting will contribute to successful outcomes, and could be easily misinterpreted as better luck. Preparation and planning are essential keys to what an outsider might conclude is better luck.
We certainly can tilt the investment odds a little more in our favor by making more informed decisions (preparation and practice) and by resisting negative behavioral biases. I have been a consistent advocate of such techniques ever since the old FundAlarm days. I’m often puzzled why some folks summarily reject statistical methods.
The military training manuals offer excellent tips on how to tip the odds just a little. The Air Force likes to talk about “How to Eat an Elephant” (one small bite at a time), and the Army Field Manuals like to talk about “situational awareness” (know where the exits are) as a survival mechanism. Knowing when to fight, flee, or flow with the circumstances is essential for life survival and for investment success.
Luck is controllable to a limited extent. I have recently been motivated to learn more about this unconventional (perhaps controversial) subject. Richard Wiseman has written a book titled “The Luck Factor”. I have not read the book, but here is a Link to a summary article:
I like the writing style of Max Gunther. He wrote a book with the same title “The Luck Factor” in 1977. This popular book has benefited from a reenergized interest and is again available for purchase. I bought a copy and have just started to read it. Here is a link to a review of Gunter’s contribution:
Comments
I don't know anybody who has achieved anything of significance attribute all of it to luck or all of it to skills.
We make our own luck with our skills in that we stack the odds in our favor in a probabilistic world using our skills to the extent we can. Some are more skilled than others and some are more fortunate than others.
That is how we make our careers, our relationships and our achievements. Does anyone feel any different?
Thank you Ted for keeping the Luck discussion alive. It is a fascinating topic that does have a first-order influence and impact on investing outcomes.
I mostly agree with c-man’s assertion that “We make our own luck with our skills in that we stack the odds in our favor in a probabilistic world using our skills to the extent we can. Some are more skilled than others and some are more fortunate than others.”
It is indeed a probabilistic world with the future a cloudy uncertainty. Therefore, in my postings I continually emphasize the scientific experimental method of collecting real data, organizing that data in a statistical manner, and then making a decision based on analyses of that data bounded by our preferences and constraints.
I have never known a successful person who attributes 100 % of his success to skill. All acknowledge the incursion of a Luck Factor. On the other side of that equation, I have known folks who attribute 100 % of their many failures to being unlucky. The two groupings are very asymmetric in their self-evaluation. I’m not shocked by this observation. Some people find an accurate self-assessment an undoable challenge.
I do believe that anyone’s position on the luck spectrum can be improved. Working to develop positive factors like adaptability, resilience, tenacity, education, out-of-box-thinking, and goal setting will contribute to successful outcomes, and could be easily misinterpreted as better luck. Preparation and planning are essential keys to what an outsider might conclude is better luck.
We certainly can tilt the investment odds a little more in our favor by making more informed decisions (preparation and practice) and by resisting negative behavioral biases. I have been a consistent advocate of such techniques ever since the old FundAlarm days. I’m often puzzled why some folks summarily reject statistical methods.
The military training manuals offer excellent tips on how to tip the odds just a little. The Air Force likes to talk about “How to Eat an Elephant” (one small bite at a time), and the Army Field Manuals like to talk about “situational awareness” (know where the exits are) as a survival mechanism. Knowing when to fight, flee, or flow with the circumstances is essential for life survival and for investment success.
Luck is controllable to a limited extent. I have recently been motivated to learn more about this unconventional (perhaps controversial) subject. Richard Wiseman has written a book titled “The Luck Factor”. I have not read the book, but here is a Link to a summary article:
http://richardwiseman.files.wordpress.com/2011/09/the_luck_factor.pdf
I like the writing style of Max Gunther. He wrote a book with the same title “The Luck Factor” in 1977. This popular book has benefited from a reenergized interest and is again available for purchase. I bought a copy and have just started to read it. Here is a link to a review of Gunter’s contribution:
http://www.google.com/search?q=luck+factor+max+gunther+pdf&hl=en&gbv=2&nfpr=&spell=1&oq=luck+factor+max+gunther&gs_l=heirl
Best Wishes and Good Luck to all.