Luck |

Trading on the stock exchange is supposed to be one of the most riskiest activities. A trader’s job is very difficult from that of an investor. A trader enters into multiple trades in a day to make profit due to movement in stock prices based on a science called “technical analysis”.

A very dear friend has given up this field after more than 2 decades. He feels that the transaction tax has made this business nonviable. Recently I met a long lost friend after 30 years. He too is a full time trader in stocks and he is making good money.

So what is the moral of the story? Is it the business which is bad? Can’t say that as one of them is making good money. Maybe their techniques are different or is it plain old luck/destiny? Or is it that exceptions prove the rule?

I remember reading a book “The Black Swan” by Nassim Nicholas Taleb in 2008, which changed my views about the stock market. I used to caution a client who believed that he had cracked the code and had started day trading business. He too learnt his lesson after incurring huge losses. He then read this book to analyse the reason for this losses.

We have a strange way of defining luck. When my friend succeeds, she is lucky. When I fail, I am unlucky. When I succeed, I say I was well prepared. when my friend fails, I say she was lazy. Different conclusion for the same result – depends upon who is at the receiving end!

I firmly believe that luck plays a role in your success. However, I have seen on most occasions we confuse luck with preparation; and bad luck with lack of preparation.

Many times, what we call as luck is actually Opportunity meeting Preparation. This is not luck. People spend years in preparing themselves for certain opportunities & finally one day the opportunity comes and they are prepared to capitalize on it. This is not luck. This is confluence of Preparation with Opportunity.

Yes, you need His blessings to be successful. However, God helps those who help themselves. When “Prayaas” (your preparation) meets “Prasad” (His blessing) then you are successful. Osho explained this with a wonderful example. He said that your vessel will be filled with water only if God sends rainfall to your backyard. However, what if the rainfall happens and you had not kept your vessel in the backyard or worse still, you had kept it upside down. The vessel will not be filled.

And what is Bad Luck? It is the confluence of “Lack of Preparation” with “Reality of Life”. You have not prepared properly for the exams. You have skipped a few topics from the subject hoping that you can leave it as a choice question. And then reality strikes! The topics you have left for choice turn out to be examiners favourite topics and all the compulsory questions are from these topics. You call it “Bad Luck”. Is it really bad luck, or “Lack of preparation” meeting “reality of life”?

So it is ‘Preparation’ or ‘Lack of Preparation’ that decides success and failure. Investment is all about preparation; you cannot simply be successful or depend upon luck for Financial Freedom – you have to prepare for it.

So what is “Preparation”? I have a very simple formula for preparation. I call it the TCS formula (TCS or Tata Consulting Services is one of the most valuable share on India stock exchange- not a coincidence!). TCS formula of preparation translates into Training, Courage & Sacrifice. You never achieve success in your first attempt; however you will improve with training – he trained hard to develop his talents. He had the courage to overcome failures. He made lots of sacrifices to train himself.

What do you want from life & are you preparing yourself to be lucky? I know many of you will still say that you have to be lucky to be successful. I would love to hear your beliefs.