The Trader’s Journey: 5 Phases of A Successful Trader

Let’s talk about the trader’s journey, because there is a roadmap to becoming a successful trader.

In this article, I will give you the exact roadmap I personally used to find success and the same one I give to all of my private coaching students.

Just as important as understanding the right things to do, it’s also important to understand how so many end up on the wrong ‘path’ to becoming a full time trader.

So first, I want to start with the ‘wrong’ trader journey.

The Wrong Trader Journey

Unfortunately, the vast majority get started on this path to becoming a trader and never leave.

Phase One: “Let’s buy a stock.”

Most traders start their journey by simply buying a stock.

Hey, this is how I started.

If you’ve been following me, you may have heard me talk about this before. The first thing I did when I decided I wanted to trade, was to buy the German car manufacturer, Volkswagen’s stock.

At the time, I had to call my broker to get updates on the price and I’m sure I called him a dozen times within the first few days 😉

In my 20+ years of trading, this is where I see the vast majority of people ‘cut their teeth’ with trading.

Buying stock is easy for most people to wrap their heads around and doesn’t require any strategy. “Oh I like this company, so I’ll just buy the stock.”

Phase Two: “Hmm…This doesn’t work.”

So after blindly buying stock in their favorite company…most people quickly realize “Umm….that didn’t work!?”

Often new traders are buying a stock that’s promoted in the news or a stock that “makes sense” to them.

But most of the time, the stock has already made its move by the time the talking heads caught wind of it.

Let me show you a few examples of what I’m talking about.

There used to be a website that scraped data from Robinhood, where you could easily see which stock was the most popular among Robinhood traders.

Nothing against Robinhood traders, but this is where most people who are new to trading seem to get started.

Here’s the leaderboard (when it was still live):

trader's journey

These are the most popular stocks among Robinhood traders at that time. Let’s take a look at what they were buying:

Ford

Ford is in 932,585 Robinhood accounts. That’s crazy!

So let me just show this to you, because when you click on this, here’s what you see.

trader's journey

You see that most of the Robinhood traders bought Ford at around $5.37.

And they kept buying and buying despite the fact that the company doesn’t appear to be in the best of positions.

This is where they said, “OK Ford must be a good company, right? So let’s buy this.”

Let’s take a look at some other ones that are a little puzzling:

GE

trader's journey

No idea why GE is so popular among Robinhood traders. But as you can see, most bought GE when it was at the low of $6.32.

Right now it is trading at $6.60. So no idea why this is so popular, but doesn’t that sound familiar that most people start this way?

American Airlines

Another one is American Airlines, a lot of Robinhood users put American Airlines in their account when it was trading at around $14.

trader's journey

American Airlines has been trading at $14, right now it is trading at $11, so just piddling around, leaving a lot of RH trader’s upside down on their positions.

Anyhow, let’s get back to the traders journey.

So you see, after buying a stock and then going through phase number two of “This doesn’t work” this is when most traders move on to phase number three.

Phase Three of the wrong trader journey: “I need an insider tip or strategy.”

This is where traders believe if they’re doing what everybody else does, it doesn’t seem to work, right?

I mean, you have just seen it. The most popular stocks in Robinhood accounts are just piddling around, just chopping sideways.

So this is where most traders think, “OK, I need an insider tip or an insider strategy.”

And so they Google “best stocks to trade” or “the best stocks to buy in 2020.” And they find these flashy newsletters that promise them the next big stock.

So they buy the newsletter or the trading strategy that promises them the most outrageous returns and then they move back to phase number three.

Does that sound familiar?

If you recall, over the last year or so 5g Stocks have been all the hype with countless trading gurus promoting them in their costly newsletters.

So after realizing that the so called ‘trading guru’ wasn’t helping them along either, this is where most head back to stage two: “This Doesn’t Work!”

And now, they are stuck on the Ferris wheel and go from phase two to phase three and round, and round, and round, inevitably leading to an account blowout or quitting right before it happens.

By the way, I wrote an article for you on these insider tips, on the best 5G stocks.

If you’re interested in learning more about the best 5G stock and the truth behind these newsletters, you can check it out here.

So they go round, and round, and round until they lose all their money and then they move on to phase number four.

Phase Four: “You just can’t make money with trading.”

Phase number four of the wrong trader’s journey is where they say, “You know what? You just can’t make money with trading!”

You know these kind of people, that’s when they get bitter and frustrated, it’s never their fault. It’s the fact that the ‘game’ is rigged and the rules aren’t fair

And, hey, I completely understand. Of course, they are not happy. They likely just lost a bunch of money.

And of course, they vent and say, “This is all is scam!” And you know what? A lot of it is.

I actually did an article on one of these scams. You can read it here. It’s where somebody promises that your money doubles every week or something like this.

Anyhow, so after this, they move on to phase number five.

Phase Five: “This doesn’t work. I don’t want to do this. I QUIT!”

Phase number five is simply giving up and saying, “OK, this this does not work. I don’t want to do this.”

And that’s usually the end of their trader journey.

I’m sure that you know somebody who has been down this path and eventually just threw in the towel and gave up.

As you can see, it’s pretty common for new traders to head down this exact path, which nearly always leads to frustration, anger and a lot less money in your pocket.

So now that you understand the pitfalls most new traders make, let’s discuss getting on the RIGHT trader journey.

The Right Trader’s Journey

Let’s talk about the correct path new traders should take towards success and trading for a living.

With the right trading journey I will give you very specific examples on how I can help you.

Phase One: Decide what type of trader you want to be

First of all, you need to decide what type of trader you want to be.

I primarily use swing trading strategies, which means I’m typically in trades for a couple of days to a couple of weeks.

And you see, there’s ultimately three categories people tend to fall into.

A lot of this boils down to how much time you want and can spend looking at the markets.

For me personally, I don’t like sitting at my computer all day long, so swing trading is what I prefer most.

Here are the three categories you could fall into:

  1. Investors. This would be buying and holding stocks or maybe ETFs for longer periods, usually months to years.
  2. On the other side of the extreme, you have day traders, where they get in and out of an asset like a stock, ETF, futures, options on the same day.
  3. The third category, which is right in between and where I like to be, are swing traders. That’s where you get in and out of an asset like stocks or options within a few days or weeks.

Ultimately you need to decide which of the three suits you best. For most people, like me, swing trading seems to be the spot where people settle. You don’t have to be glued to your computer, but are still somewhat active in the markets.

Phase Two: Pick a trading strategy

After you decide what kind of trader you want to be, now it’s time to pick a trading strategy.

And how do you pick the best trading strategy?

Every trading strategy has pros and cons.

Now, I personally have a core swing trading strategy that I’ve been trading for over 10 years and it’s called the PowerX Strategy.

The PowerX Strategy is a trend following strategy, that can be used on stocks and options.

I personally don’t care if markets are going up or if they are going down as long as there is a trend (up or down).

Now, if you would like to learn more about the way how I trade I have two resources for you.

First, it’s a website called MyTradingRoutine.com. And on this website, I’ll show you exactly how I trade and the tools that I use.

We’ll talk about tools here in a moment.

And then, of course, the book, which is the PowerX Strategy.

Now, I might be biased, but I think it’s a really awesome book. I highly recommend that you get a copy of it here. I’ll ship a free hardback copy, if you cover $4.95 shipping and handling.

But, hey, there are so many trading strategies, I don’t care which one you pick as long as you pick a strategy.

Now, once you understand the strategy, the next step is tools, to help you make good trading decisions.

Phase Three: Trading Tools

You need to have the tools to help you make the best trading decisions on your trading journey.

Because you see, trading can be simple but too often people overcomplicate it, making it way more difficult than it needs to be. For me, it’s always best when I keep it simple.

I personally use a tool that takes a lot of the guesswork out of it and find solid setups and it’s called the PowerX Optimizer.

You probably have heard me talk about this. This is what the tool looks like:

So it makes it super easy to consistently find solid stock and option setups based on predetermined parameters.

With just a few mouse clicks the software runs millions of calculations in a matter of seconds.

It also really helps me to keep my ego in check because it gives me clear entry and exit signals so that I never hold onto a winner or loser too long.

On average I’m spending less than 15 minutes each day finding and placing my trades. And I think it’s truly that simple.

I like to use custom calculators in my different trading strategies.

If you’ve traded any of my other strategies like “Theta Kings” or “The Option Income Wheel” you’re well aware of my “Put Options” and “Wheel” calculator that I use to setup my trades.

Ultimately, all of these tools do the same thing: help me to take high probability trades based on rules not what I’m thinking.

Phase Four: Expanding your knowledge

Let’s move on to phase number four, because the next part of your trading journey after you have mastered a strategy is this.

It is expanding your knowledge.

What does expanding your knowledge mean?

You see, there are other types of strategies and financial vehicles available to trade.

I’m a very big fan of the saying, “The more you learn, the more you earn.”

Now, for most traders, they start off by buying and selling stocks and from there they make their way over to trading options.

This makes a lot of sense because options can be a great way for you to rapidly grow an account.

With the PowerX Strategy, we like to keep things simple by often just buying calls and puts. So it’s perfect for beginners.

But as you’ll find out, there’s more than one way to get long or short with options.

I’ve recorded a series of both of beginners and advanced option videos that are a great way to get started if you want to start trading options. These can all be found on my YouTube Channel:

  1. Options 101
  2. Options 201
  3. Options Income Trading Strategies

Phase Five: Trading for a living

So let’s talk about step number five. The next part of your journey is then trading for a living.

I mean, ultimately, that is what you want to do as a trader, right?

When you’re ready for this phase, then I think you and I should talk.

I like working with people who are committed and want trading success.

That’s why I personally work with a handful of traders in our Freedom Mastermind every year.

Trader’s Journey Summary

As you can see, these journeys are wildly different.

It’s very important that you don’t fall for the trap of the wrong journey. Honestly, this is how I lost a lot of money with trading when I first got started.

If you want to succeed with trading, do it right. You now know how with the five phases of the right trader’s journey.

If you enjoyed this article feel free to leave a comment below and share it with others who will find it helpful.

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  1. Hi Marcus my name is Anthony I've been following you for about 3 months now I wish I would have discovered you 10 years ago when I retired I've been doing the wheel strategy and making about 1% a week for income did you invent the term wheel strategy I haven't heard it before but now it seems to be all of the internet I tried never to miss an episode if I do I go back and try to find it you are a very honest guy I like the stories by you and your family keep up the good work your friend Anthony Vinci

    1. I did not invent the term “Wheel strategy”. 🙂 I wish I did, but I did create my own wheel strategy. I am glad that my contents helped. Thank you for subscribing.

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