Nach der Tragödie um ihre Eltern kehrt das Glück zurück.
After her parents' tragedy, her luck returned.
Why is um used instead of von? What if von is used not um, will it still be correct grammar?
"Um" is correct here. "Tragödie um" means a tragedy about something, which is what you want to say here.
The following sentence is grammatically also correct:
However, this would probably be misunderstood as the parents being the source of the tragedy and not the victims.
Besides: Be careful about tense: While possible, the exact translation of the english sentence would read: