The distribution of the returns to stock portfolios of various sizes and the distribution of the gains from stock holdings among households implies that households own relatively few stocks. The evidence shows that the more diversified is the stock portfolio, the less variable the return. Hence to observe a high concentration of the gains among households suggests that they do not pursue the safer course of holding diversified stock portfolios. It seems plausible therefore that luck plays a bigger role than skill in determining the return from stock holdings. This essay supports this conclusion with a variety of evidence.