Luck, Skill and everything in between
My husband Hari and I were playing snakes and ladder with our baby niece and nephew of 4 and 6 yrs. They both were the first to win the board and get out the game. They were overjoyed to beat two adults in a real game. The 6 year old even tried to console us by saying “Don’t worry. We have been playing this game a long time, you will also get the hang of it soon.”
The next day, from my Nephew’s B’day gift we played a memory game. Now the difference between the adults and the children became obvious. We were trying to help them learn the game but were not planning to make deliberate mistakes to make them feel good. The kids were a good sport but were disappointed that they lost in all the games.
What really is the difference between the two games?
There is no world champion in the game of ‘Snakes and Ladders’ because it is a game of pure luck. But there is a champion of Memory, Spelling Bee, Tennis and even Poker. The luck and skill ratio in each of these games vary to a good extent from mostly skill to luck being a major contributor of results.
This is true of our investing journey too. Whether you invest a lumpsum or SIP, even the dates of your SIP may all be random and luck. But your asset allocation, review of portfolio performance, the discipline of consistently investing in alignment with your investing philosophy are all attributes of skill and discipline.
By mastering only what is in your control, you can significantly influence the results and the let the time play out the luck factor. So what do you think – Is Investing a game of luck or skill or both ?
#investing#luck
