The six stages to achieving trading success:

1. Ownership
2. Planning
3. Working
4. Analyst
5. Artist
6. Trader

The first three stages tend to be obstacles, while the second three involve the process of learning to trade.

By reading each stage carefully, even multiple times, and taking a 1/2 hour out of your day to relax in your favorite place and consider that day's stage, you will move yourself much closer to your goal of being a successful trader.

Day One: Ownership

The first, ownership, which we will cover in today's lesson, is the biggest roadblock, and the reason why most individuals fail to become successful traders. Ownership encompasses your belief that you own everything from the idea to become a trader, to the method you will use, to the time you trade, to the platform you use, down to the chair you sit in and the mouse you hold. You are not only attached to these components, you own them, and value them as such. Because of this it will be difficult, and in many cases nearly impossible for you to change any of them based on someone else's suggestion. This can be particularly so if the person making those suggestions is different than the type of person you would normally seek counsel from. The problems created by ownership, also known as "attachment" are ego related, and commonplace in individuals who trade only their own money. Some of the best examples of this I have seen were experienced traders coming off the trading floor who would not take the counsel of younger traders offering advice about trading on the screen. It is not easy for people to heed the advice of someone younger who they perceive to be not as knowledgeable or experienced as themselves, particularly when the advice is free. Our ego makes decisions for us regarding other people based on everything from age, to different politics, to whether someone shaves regularly, without a second thought. The idea of taking advice from someone different than us, let alone of being in a position of owing them a debt of gratitude, runs deeper than we know.

Traders who have been trained professionally to manage firm or customer money generally don't have ownership issues. They own none of the before mentioned components, and always know that if they are not successful they will be fired. It is obviously much easier to be trained, have a funded account provided for you, and to be given your marching orders by professionals, than to do it on your own. There are no egos on a professional trading desk on the first day of a new month. Most professionals are comfortable in the knowledge they owe their paycheck to those who came before them.

What is the cure for "ownership" for people just learning to trade? Realize that it is ok to be thankful to others for their help, and there is nothing wrong with owing someone a debt of gratitude. Most of us find the idea of owing someone, particularly for something that led to us putting money in our pocket, burdensome; that type of thinking is a serious handicap. Not listening to someone who can contribute something you need and avoiding being indebted to them for helping you because of your pride is destructive behavior that contributes to failure. For many of us just about every decision we make, or have made, is done with our emotional or physical well-being in mind; which is human nature. It goes against the grain, to ask for help, and then express nothing but honest gratitude in exchange; particularly when that helps comes from a source we could not have predicted. An open mind will eventually overcome the attachment of perceived ownership and opinion.

Day Two: Planning

Today's lesson covers the 2nd phase to achieving trading success: planning. Nothing that has stood the test of time in this world was built without a plan. It is essential in your journey to become a master trader that you have a plan. You will definitely need a trading plan, which will tell you what and when to trade, and how to manage your trades. But before you get to writing out your trading plan, you need to make the most important decision you will make, which is to identify what methodology you will use. The methodology will define how you trade; whether you are to be a trend trader, or a mean reversion trader -- counter-trend trader. Which time frame you trade also needs to be determined depending on variables from if you have a job other than trading, to your attention span, to how much sleep you need. Most of us learning to trade gravitate to counter-trend trading because it dovetails with our perception of value. Counter-trend trading in simplest terms means buying price dips and selling rallies, which supports our existing believe to buy when something is cheap and sell when it's expensive. It can be said that the vast majority of us have mean reversion mentalities; meaning we have a rough idea of the worth of something so it does not make sense when price goes too far beyond that value in either direction. This mindset supports a method that takes advantage of sideways markets. Given price goes sideways the majority of time most traders initially opt for a counter-trending method. The potential drawback to a mean reversion method is over the long-term, markets are anything but mean reverting. Historic charts of stock indices and currencies show long drawn out price trends that often last for many years. We have to take a closer look to make out the sideways price action when markets pause or eventually do reverse.

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