There-Is-No-Free-Lunch

This time honored saying was one of my father's favorites. It has broad applicability, but it rings especially true for stock and options trading. For example, I recently read the following on the web site of a well known options trading education firm:
"When was the last time you made 300% in three weeks?"
And during a recent webinar by a stock and options trading education and advisory firm, the speaker was discussing his background and experience and explained that he had:
Discovered the Holy Grail of Trading.
There is a tendency, seemingly inherent in humans, to believe that someone out there has the secret formula or inside track to making money in stocks and options trading. Of course, that simply isn't true. There is no free lunch.
One of the most fundamental laws of finance links risk and reward: high rewards only come at the expense of incurring high risk, and, conversely, low risk investments necessarily result in low returns. 

 There are many different ways of trading stocks and options. But these different strategies can each be characterized by a risk/reward ratio. Trades with high risk/reward ratios offer high probabilities of low returns, but those consistent, low returns are accompanied by very large potential losses, albeit with low probabilities of occurrence. On the opposite end of the spectrum, one has low risk/reward trades where the losses are small but highly probable – these are the "lottery tickets" of stock and options trading. The potential gains are huge (as in "300% in three weeks"), but the probability of achieving that gain is very small.