How Much Of Good Investing (and everything else) Is Caused By Luck?

By: ispeculatornew
Date posted: 06.13.2012 (5:00 am) | Write a Comment  (0 Comments)

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I’m a big believer in guys like Warren Buffett and I personally think that their long term vision and ability to find good opportunities has been the main reason behind the huge returns that he has achieved over the years. Others however disagree. I once read about the fact that if you had tens of millions of monkeys making investing decisions, there would be a few that would outperform the market for a few years. Among those, a few more would continue to outperform for a decade more. I’m not saying that is the cause but among the tens of millions of investors, there are bound to be a few that perform amazingly well for decades.

Then last week, I read the transcript of the Commencement remarks that Michael Lewis made to the 2012 Princeton graduating class. I’m a big fan of Lewis, of many of his recent books and to see this guy explain that in his opinion, much of his success is due to luck made me reflect. It made me think about many different things that have been going right for me so far in my life. How much of it is due to hard work, to skill and to what I might have learned in school or by reading? And what about my investing? I’ve done well in recent years, but part of that has to be luck right? Or am I way off base here?

I’d love to hear your thoughts! How much of what you are as a person and as an investor has been defined by luck?

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