Ricardo,
Good question! On the surface the lack of randomness in the stock market seems to contradict the impossibility of predicting the future. There is no contradiction. While people cannot predict the future, some can make very good guess which pay off more likely than not. On average in the long run, they earn about 10% to 12% a year in the equity market.
You asked if bad luck is random. No, I believe it follows some people around like a dark cloud. Not only that, its aim is poor, so if you are near them, you will get struck, too. My guess is that a lot of the people in the WDC thread are the kinds of people that have bad luck. So don't spend too much time there. It can rub off. Another thing. People with bad luck often end up hanging out together.
And your story of the two children is just a clever way of saying the old adage: Luck favors the prepared, which I believe is true.
Predicting that people in a car going over a cliff are going to get hurt is no prediction at all, since for all intents and purposes, it has already occured. Predicting which bones would get broken would be a matter of luck. Although I suppose a doctor could make some pretty good guesses. It's kind of a stupid analogy, though, because even that would not earn him 10% to 12%.
As to why I checked this thread, the markets have taught me a lot of things. I thought I might be able to see what lessons it has taught others. I looked for good lessons for about twenty minutes, but I have to admit, I was disappointed with what people wrote.
Guess I was unlucky.
Happy Investing!
Vanni |
