Skill v. Opportunity (& Luck)

Can a great trader have great skill and no opportunity to make money? Can a bad trader have no skill and tons of opportunity to make money? The answer is yes to both questions. Luck is at play in the short-term for most traders. There will always be “some guy” with a great one year return. The sustained edge appears only over time.

What’s the point? What happens when the bad trader with no skill finally finds himself with no opportunity? Think about it.

Jon Sundt of Altegris is to be thanked for the root of this analogy. He made it at a recent symposium I attended.