Paul is correct. 1 knot is 1852 meters. If your torpedo takes one minute to reach the target. you will be off by 300 meters, so closer is better.
The further away the target the more you need to fire a spread to hope for a hit.
Bearing accuracy is also important, but not so much. Set on fast (i.e. 45 Knots), the torpedo will travel about 1400 meters is one minute; so each degree of relative bearing will be about 30 meters.
If your target speed and bearing are accurate, range doesn't make much difference as the relative ratio of target speed to torpedo speed will be the same. This is hard to believe, but it is true.
Of course, wind speed, ocean current speed, mechanical problems affecting torpedo speed, water temperature, depth setting on the torpedo, sub speed, torpedo delay from the time the torpedo is fired to when it actually enters the water, delay due to the time it takes the torpedo to accelerate to 45 knots, accuracy of your estimate of the target's course, and a host of other factors also are important.
How torpedo can hit anything is a mystery to me.
I really don't feel too bad when I miss a target, especially one traveling fast.