Is Luck part of successful trading?

User

Experienced member
1,170 23
I was just reading other threads and I wondered if 'luck' is part of trading as a whole.

You can look at this from any perspective. You have an account of £1000.

A system or theory can be applied to a currencies, indices, commodity or shares and you could look at a chart as hard as you want and come to a 'true' conclusion as to if the market chosen will simply rise or fall. Now your first 10 trades could easily win or lose. If you win your account would be in a terrific position. If you lose then it’s even harder to get to breakeven as in percentage terms the task is more of a struggle.

Any views from other traders on if 'you' think Luck could be a critical part of successful trading?

:rolleyes:

:?:
 

Dow Dog

Well-known member
409 0
I think the key to successful trading is CONSISTENCY in everything.

"Luck" is probably random so over the long term the effect of "luck" would be fairly irrelevant to the outcome of your trading especially if you were trading a good system consistently.

But what exactly is luck anyway ? It's a bit like Love. Undefinable.

Hence nobody really knows what the expression " Lucky in love" means.

I digress.
 

TWI

Senior member
2,535 254
If you have a 1000 acount luck is definitely a factor if you want to make a living out of it. If you start a fund you better hope the track record looks good in the beginning and that could include an element of luck too.
If you want to be consistently profitable over the long term however luck does not figure, just discipline. This is not to say that in some trades you can't get lucky, you do as in others you don't.
 

damianoakley

Established member
542 57
Luck and chance play it's part in playing the markets, just like in any game.

But in the long-term it should have little effect on your overall account if you play the game correctly.

Let's say that we take the £1,000 from the original post and have the 10 losers in a row that you mention. Well, if you are managing your risk correctly, those 10 losers should not necessarily set you back to a level that would be difficult to come back from in a short space of time.

In fact, a market can go up or down. That means that when you get into the market, you technically only have a 50% chance of success. Therefore 10 losers in a row will actually be more common than you think. It happens to me at least once a week.

Looking at your £1,000 - let's say you decided to risk £100 on each trade. You enter the market 10 times and every trade loses. You've just been wiped out. Let's say however, that you decided to risk £20 on each trade. Your 10 losers have only set you back to £800 and you live to fight another day. So your run of bad luck was not actually that bad, because you controlled your risk appropriately.
 

Dow Dog

Well-known member
409 0
If you have a 1000 acount luck is definitely a factor if you want to make a living out of it.

If you want to make a living with a 1,000 account then you will need more than "luck". You will need Divine intervention.
 

Nildes

Active member
144 0
Who was the golfer who, when congratulated with the words "That was a lucky shot" replied: "Yes, and wasn't it lucky that I got up early every morning for years to practice too?"

I suspect you make your own "luck" :D
 

TWI

Senior member
2,535 254
It was Samuel Goldwyn originally said
"The harder I work, the luckier I get."
Although Gary Player nicked it and often gets credited
 

Trader333

Moderator
8,639 969
In my view luck only plays a part on an individual trade basis. Over time and a large number of trades, luck is almost totally irrelevant as statistical probabilities will nullify any effect that luck has on any trading approach.


Paul
 

StockBaron

Junior member
21 0
Understanding Probability is a critical factor in successful (long-term) trading.

Those 'lucky' traders whose continued success depends more on luck than a solid grasp of probability (along with an equally solid grasp of risk & money management & trade selection & execution) will not be long-term successful traders.

If I could think of a sensible way to pose the question, I'd suggest a Poll along the lines of "How long have you been trading successfully?", but I suspect the masses who are/have not been long-term successful are not reading these boards anyway.

It's also quite possible of course, that many long-term successful (true traders) do not read them either.

Hence the pointlessness of thinking about polling t2w members.
 

User

Experienced member
1,170 23
I share a lot of the views expressed. If anyone gets 'lucky' to start of with, be strict to your money management and trading system then it will be compounding all the way.

The moral of this thread is, you may express your trading activity as 'luck' to start of with, if consistently successful then it will be a matter of 'skilful trading' with a bit of luck here n there. Make sure you compound your winning trades, as that will get you far.

Let me ask something else:

What makes a 'successful trader'? If you could define it in five individual words or phrases, thanks.

Self discipline (A successful system of trading defined by yourself, but also the discipline to abide by it)
Experience
Balls of steel
Courage
Cautious
 

chump

Senior member
2,212 274
patience

more patience

even more patience

a lot more patience

and finally don't forget patience
 

Nildes

Active member
144 0
I think luck is often an unexpected perspective on a normal activity.
For instance, you buy on some good TA and get a boost from some positive newsflow or you sell for sound reasons just before the market drops because of something like the Madrid bombings.

Experience teaches that these events are always possible but doesn't give any way to predict them.
So you could call them luck.....good or bad...but still rely on the discipline of your TA and playing the averages to come out ahead.
 
 
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