First let's talk about values of colors. "Value" is the amount of lightness and darkness in a color or pigment while a "tone" is a color or hue plus different amounts of black or gray and "Tint" is a color with varying amounts of white.
Try to paint this using only black paint. In your palette, mix black and a little bit of water. The left-most box should be painting with the richest black. Every time you go a box to the right, simply add a bit of water to your black mixture in your palette. Eventually your last few boxes will be painted with a very diluted gray. Keep the right-most box empty to show the purest white (the white of the paper). This activity is good for knowing your water and paint ratio as well as understanding how to achieve saturated and desaturated applications.
Watercolor painting involves tons of color mixing. A lot of artists can utilise the fewest colors to achieve a vast range of hues, tones, and tints.
Terms to remember:
- Color - a general name that describes how we see light reflecting on an object i.e. red, yellow, blue, green, etc.
- Hue - a specific color name that is identifiable from a synonymous color, shade, or tint i.e. Cinereous Blue, Ultramarine Blue, Prussian Blue, etc.
Note that "Color" and "Hue" are two terms usually interchanged by a lot of people in different practices handling colors.
It is of utter importance that an artist knows very well what his/her palette can achieve. A good, versatile set of colors is able to create a satisfactory amount of colors for painting almost all subject matter. For this article, we are using the 12-color Sennelier Set.
This set has a good selection of colors. The colors are: Burnt Sienna, Ultramarine Deep, Phthalo Blue, Warm Sepia, Lemon Yellow, Carmine, French Vermilion, Alizarin Crimson, Payne's Grey, Phthalo Green Light, Forest Green, and Dioxazine Purple.
To fully understand the color palette more, you may mix the color wheel by only using primary colors. The set has only one yellow (Lemon Yellow) and one primary red (Carmine) so create 2 color wheels to compare mixtures using the two blues (Ultramarine Deep and Phtalo Blue). The middle of the color wheels below are neutral colors that you can achieve. 
Neutrals are created by adding complementary colors (colors that are opposite of each in the color wheel). See below for possible combinations.
These neutral colors are great for shadows and desaturated mixtures for creating realistic paintings. A lot of artists debate about the use of pure black in painting. This is because simply putting pure black in a painting tends to produce a flat looking finish. Using your own mixture of grays is great for creating the illusion of a lustrous shadow or dark areas that have more depth.
The other colors in this paint set can create even more colors for your use. It can be seen that Lemon Yellow added with Ultramarine or Phtalo Blue produce slightly different greens. This smallest shift of color hue makes big differences. French Vermilion when thinly applied on paper almost looks like orang. This means this hue has a yellow bias. See how French Vermilion (a warm red) mixes great with Ultramarine Deep (a warm blue). However, mixing French Vermilion with Phtalo Blue (a cool blue) makes for a neutral mix of violet.
It is important to know about color bias. Colors are always biased towards either side of where they are positioned in the color wheel. A yellow may either have a green/blue bias or an orange/red bias. Using the logic of complementaries combined to make gray or neutrals, adding colors of different color bias produces muddy mixtures. To read more on color bias and purity of colors, see:
To make things easier later on, especially if your are painting outdoors. It is good that the 12 color set of Sennelier has pre-made light and dark greens, browns, a violet, and Payne's gray to be added to any color for darker tones.
How about you, have you tried mixing out the possibilities of what's in your palette?