3 key components for successful traders

Ron Wagner “Accountability, Responsibility, and Passion.”

The accountability part is about being honest with ourselves about our progress to reach our goals. Human nature has most of us chasing "easy," but in reality, easy is a matter of learning the proper skills, perfecting them, and then systematically using them.

Because many would prefer to hide under the trials and tribulations anyone would face taking on a new endeavor, ego gets in the way. Accountability to someone (or at least to ourselves), by tracking and evaluating our progress, will be paramount to our ultimate success.

Let me explain this in another way. Any worthwhile endeavor has some sort of structured learning curve. Universities or trade schools have a finite curriculum. Even though we don't really master a skill until we are on the job, we still know what is expected of us, and the measurement will be most often reflected by a grade.

Once on a job, performance is measured by standards set by those that have come before us. In many cases, internships or training periods are imposed. Why should trading our own accounts be any different? Who is going to administer this accountability? If we don't have a way to do this, failure and struggle is likely. This is why most traders fail at growing their accounts.

This brings me to the next part: "Responsibility." We built our financial ability to trade our own accounts, and now we are ready. We have studied material until our eyes are bloodshot. We know some techniques in theory. We have even tried a few trades along the way.

Then something happens! In the heat of battle we get sidetracked. We somehow are changed forever once we start trading with cash.

If we have a successful trade, we want another. If we lose money, we want revenge. How can we win at this? We must be responsible and stay focused on our goals.

Would you hire yourself to trade your account? I think this is a key question everyone should ask. If you hired someone else to manage your account, would you have rules for them? Would you keep them employed if they broke the rules?

This is the responsibility piece to understand that this business of trading and investing our own accounts is nothing more than any other extremely worthwhile endeavor, but we must be accountable and responsible. We must have a plan of action to help keep us focused. We can't take a cavalier approach to the way in which we trade.

The final piece I want to leave you with is about "Passion." What you want to do and what you are good at may be two different things entirely. You may intellectually say that you would like to trade for an hour a day and want to make great money doing so. Your skill level at first may not match your ability to do so. It will be your passion that will help you achieve your goals.

I am, and will forever be, a student of the markets. I love and am passionate about technical analysis. I find it so extremely fascinating and rewarding. We can read, through technical charts, what others are thinking and where they will be taking action, and then act on that knowledge. If I had not proven to myself that this was possible, how could I be passionate about trading?

Next: Who will ultimately become the most successful?

Anyone can learn the mechanical part of trading. It will be those that are passionate about something that will ultimately become the most successful. Each day when I wake up and prepare to trade, I can't wait to get to my computer. Even though I am systematic, organized, accountable, and responsible, each new day brings a slightly different challenge to trading. I love that challenge and embrace it.

Becoming consistently profitable can go a long way towards achieving your financial goals. Becoming consistently profitable can also go a long way to developing your passion for trading. After all, we usually love something that goes well.

What will ultimately make the most difference for your ultimate success will be whether or not you can work around the ego issues and emotional roadblocks along the way, while you are developing a consistent plan of action for yourself.

My wife and I have been trading our own accounts now for over 15 years, and I have been teaching others for over 13 years. We both talk about trading every day, and I get the most enjoyment out of helping others develop the skills needed because I know the rewards are worth it. No other endeavor I'm aware of can pay us so well in a short period of time by just being patient, disciplined, and focused.

I completely believe that some form of successful trading is possible for nearly anyone. Have you found your niche yet? Have you found your way yet? Have you found your passion? If not, you can!

I hope you have enjoyed this series of articles, and will put to use the many tips along the way. And I hope our paths may cross in the near future.

Yours in success!