"By the Grace of Kohler"

In June of 2007, after I had been trading options about a month I came across another blog after I was looking for technical analysis videos on YouTube. After watching a video he gave the address for his blog www.optionaddict.blogspot.com and the rest is history. :-)

I am always the first to give credit where it is due and I have to give almost all credit for my quick progression to Jeff Kohler. Jeff is an instructor at Investools and a professional trader. He also manages to run his amazing Option Addict blog. Everything up until I started reading Jeff's blog was simply information and ideas on how to succeed. Jeff was the example of success I needed with finite examples of trading that really hammered home concepts and made me change my old ways. I have to also give credit to the incredibley helpful community as well.

Through Jeff's blog I quickly saw the error of my ways and how I could improve my trading. I honestly believe that is the single resource anyone needs to learn to be a successful options trader as long as you can follow the rules you end up developing.

After learning technical analysis and reading Jeff's blog and exchanging a few emails I have since realized a few things are dumb to do if you are a trader.

Averaging down, if you chose a low risk entry point, you will never need to "average down" such as outlined in Cramer's books because if the stock drops you know to exit the trade.

Jeff's rules stress low risk, small position sizing, which is crucial to success. Before I would put on a huge position, thinking this was the way to make money. Having seen my new method work with way less risk, there is simply no reason to risk a high amount.

I have come up with my own trading rules after having learned from Jeff. These are basically Jeff's own rules but worded to my liking, I keep a copy of these on the wall next to my screens so I always have a reminder to not do something stupid and risk too much capital.



I cannot thank Jeff enough for the help and guidance he and the blog have taught me, hopefully I can help others through this blog and they can see value in my methods. Jeff is definitely someone I would like to meet someday and hopefully I will. By following my rules I learned I have been to get back to only 21% down from 50% down in the 3 weeks I have been back trading. Later I will describe how I now look and analyze all trades and why I think that way, which should help as I journal.

A little note about the title and picture. On Jeff's blog there was a down day in the market on thursday October 11th. Most people were upset and lost quite a bit of unrealized gains due to the unusual swing in the nasdaq. One blogger wrote "by the grace of God I had sold most of my positions earlier in the day". I posed to them that if it had been the "grace of God" then he must really love them and hate all the other Option Addicts to let them lose money. He then replied and said no it was actually due to his positions hitting their targets and being properly positioned and diversified that he was fine which was thanks to Jeff Kohler. I then decided he was actually saved "by the grace of Kohler". I liked that line and found it appropriate and humorous, hence its use here for my own situation. I have seen the light of Kohler, and it is good, lol.