“The delicate balance of mentoring someone is not creating them in your own image, but giving them the opportunity to create themselves.” – Steven Spielberg

Today’s investors seeking financial independence now have two markets to battle: the market of opinion, and the actual stock market.

It’s no wonder big banks outperform the masses. Financial institutions not only have brilliant PhDs at their disposal to create algorithms that juice their bottom line, but they also have us retail traders who act mainly to clutter and confuse each other, while they quietly position in next year’s leading stocks.

I’m not sure when it began, but lately, we’ve become more interested in convincing other people we’re right than actually improving our own investment strategy. Just scroll your Twitter feed, flip on your TV, or do a Google search for trading, and you’ll quickly be bulldozed by a flood of preachy misinformation.

It’s misinformation for two reasons: (1) The information is sometimes just factually incorrect; (2) When it is accurate, it cannot be effectively implemented by the consumer whose risk tolerances and investment timeframes may differ.

For example, I could give you a winning trade with a maximum 7% drawdown, but if you cannot stomach a 6% short-term drawdown, then you will never profit – and likely lose money.

Yet, as long as money is in short supply, people will continue trolling through the noise searching for secret recipes for which they are actually financially allergic. They’ll get sick, blame each other, and the process continues churning through unprofitable traders every year.

So how do we clean up the clutter?

The first step is to find a mentor who reinforces market context over the “live alert” strategy. Consistent traders know when the market is providing opportunities that favor the upside (i.e. long trades) or downside (i.e. shorts or cash), you cannot apply a one-size-fits-all strategy to every market condition.

In addition, winning trades are not all the same. You can profit by randomly interfering with your trade, or because you followed a pre-defined strategy. The latter is what provides the foundation for successful long-term trading.

But most importantly, good mentors don’t try to recreate you in their own image. You can’t mimic someone else’s success, but you can learn and practice specific skills to become a successful trader. As we do in our twice-weekly Top 10 report at TraderLion, we provide critical context to the market so that – first of all – it is clear when the probability for trading profitability is highest.

Second, we uniquely emphasize and train traders to develop the psychology to curb impulsiveness and fear that can interfere with that success.

The sooner you can shift your mindset to becoming consistently profitable rather than instantly profitable, the sooner you will experience financial independence.

June 16, 2019

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