Hunting for Equipment
The traditional method of finding high quality equipment is by hunting; killing monsters and being lucky enough to find something you like among the loot.
Identifying which monsters provide the best loot is one of the things you'll need to figure out. To do that you should try killing a bunch of them to get a feel for the kind of loot they carry. An easy but not always reliable indication is the amount of gold they carry; if there's a lot of gold, it's often accompanied by a chance for high end equipment. Other things to look for are the number of items, and the number of properties that the items have.
Knowing which monsters is not much use when you can't kill them. You'll have to train your skills and find the appropriate equipment to use when hunting. Don't forget to use all of the tools available to you, as different monsters or locations may require different tactics. In some cases you may find it more worthwhile to kill many monsters with slightly worse loot rather than a single monster with better loot that's much tougher to kill.
The final task is identifying a good hunting ground. What may otherwise be an ideal hunting location might be frequented by too many players, resulting in few monsters or a crowd of player killers. It can be quite worthwhile to locate a place where your party can hunt without being bothered.
Luck
The loot that you find on a corpse is significantly affected by luck - not just whether things are going your way, but also the total luck that you are wearing. Wearing high luck won't turn mongbat loot into dragon loot, but when you're looking for the absolutely best possible items, wearing luck is almost essential.
When a monster is killed, the quality of the loot can be improved based on the killer's luck at the time of the monster's death. If multiple people are fighting, the killer is the person who did the most damage to the monster. A player's pets, summons, and provoked creatures count as that player's damage.
The main benefit seen in wearing luck is an increase in the number of properties that items have. In addition, the intensity of the properties can have a higher range.
There is no cap to your effective luck. However, as your luck increases, there are diminishing returns from additional luck. That is, the difference in loot between 0 and 100 luck is much greater than the difference between 1000 and 1100 luck.
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