It's not so easy.  If you toss a coin a hundred times, it will come up with long running sequences of heads and tails, even if the ultimate ratio is 50:50. Each event is independent (the coin has no memory). In each toss, the probability of heads (or tails) remains 50 per cent regardless of the previous or following result.

One could argue that a team, which logs a sequence of wins, has done so simply through luck (though I wouldn't care to say this face-to-face with Steve Waugh, Viv Richards or Clive Lloyd). You would have to work hard and dig out more stats to prove a sequence of wins isn't all luck.

There is a similar problem in classifying investment returns and it's much bigger because luck plays a larger role. Every year some investors beat the market. Some do over long periods. Can you prove this isn't luck? It's very difficult, if at all possible.

Investors and traders have favourite methods. If they're successful, others emulate those methods. Take for example, George Soros, Carl Icahn, Jim Rodgers, Warren Buffett, John Bogle and Marc Faber. These are some famous and successful market players chosen almost at random.

Each of these icons employs methods that have worked for him over the long term. But the formulae are all very different. The frightening thought is that they may all have been very lucky � and we know about them precisely because they were lucky. Others who have faithfully emulated them have not made similar returns.

It is very easy to be seduced into believing that a method works because we see an example where it worked. We overlook the times it didn't work. Anybody with market experience knows a couple of Buffett-style fundamentalists who have lost money in the long-term.

Anybody who tried passive index investing ala Bogle in Japan in 1989 or Hongkong in 1983 lost out over the long-term. I'm not even bothering to enumerate the number of times when Soros-style leveraged bets went wrong.

The only point one can find in common is that successful investors all tend to be excellent at handling money. They are not necessarily awesome stock or trend pickers, nor are they necessarily good timers of markets. But they are all good at limiting losses and squeezing the maximum from gains. Even here, the methods of minimising/maximising are often quite different.

Money-management is probably the point where luck exits in the investment framework. Whatever methods you employ picking trends, or stocks, or going passive, you need to be a good money manager.

Instead of learning how to invest according to the methods of a chosen Guru, it would probably be more rewarding to learn the guru's methods of holding or folding in a given position.

One area of money management where luck will make a massive difference to India Inc's collective returns is the forex market. The rupee has swung between the rough boundaries of 38 and 43 per United States Dollar (USD) in the past 9 months.

Many Indian treasuries booked mark-to-market losses on outstanding credit derivatives in Q4, 2007-08, because they were on the wrong side of those fluctuations. Those positions could still reap handsome profits.

It depends on several sets of variables. One set is the rupee-USD equation and the USD-Yen and USD � Swiss France positions at expiry. Another is the possibility of positions being knocked-out if the rupee hits an interim high.

These are imponderables because different derivatives were structured differently and a week's difference in expiry time could make a big difference to the gains or losses.

The other set of imponderables is the regulatory aspect. The RBI has already got hot and bothered about this. Accounting standards are being reviewed and there are several cases pending in various courts.

This could mean that even potential winners are forced to close out prematurely. Either way, luck will have a big role to play in the 2008-09 bottomlines of corporates with forex derivatives exposure.