Ideas for March with Probability for Success

Here is a list of stocks which have been screened as possible puts to be sold that expire on the third Friday of March.  Meaning we are initially credited money to our account, and then hopefully the prices we have sold for goes down to $0.00.  I don't trade all, just some depending on their technical charts and their fundamental business models at the time of sale.

Stock Sym	Expire/Strike & Days To Exp	Opt Bid	% Prob. Above
URI	12 MAR 34.0 (38)	0.40	90.8
VRX	12 MAR 42.0 (38)	0.45	91.9
CLF	12 MAR 65.0 (38)	0.71	88.2
HFC	12 MAR 28.0 (38)	0.30	92.5
ESRX	12 MAR 42.5 (38)	0.43	91.8
RIO	12 MAR 52.5 (38)	0.45	92.7
TPX	12 MAR 60.0 (38)	0.55	91.1
URI	12 MAR 33.0 (38)	0.25	93.8
TRW	12 MAR 35.0 (38)	0.25	91.2
RS	12 MAR 46.0 (38)	0.30	92.5
VRX	12 MAR 41.0 (38)	0.30	94.5
CLF	12 MAR 62.5 (38)	0.44	92.8
CMI	12 MAR 100.0 (38)	0.55	96.9
RS	12 MAR 45.0 (38)	0.25	94.7
INT	12 MAR 40.0 (38)	0.25	95.7
ESRX	12 MAR 40.0 (38)	0.23	96.8
VRX	12 MAR 40.0 (38)	0.25	96.4
SLB	12 MAR 67.5 (38)	0.34	96.9
TIF	12 MAR 55.0 (38)	0.25	96.4
RIO	12 MAR 50.0 (38)	0.25	96.9
CMI	12 MAR 97.5 (38)	0.40	98.4
FLS	12 MAR 95.0 (38)	0.40	98.4
COH	12 MAR 62.5 (38)	0.25	97.5
APA	12 MAR 87.5 (38)	0.31	97.6
CLF	12 MAR 60.0 (38)	0.25	96.0
APA	12 MAR 85.0 (38)	0.22	98.9
CMI	12 MAR 92.5 (38)	0.25	99.6
CMI	12 MAR 95.0 (38)	0.30	99.2
SLB	12 MAR 65.0 (38)	0.22	98.9
SPG	12 MAR 115.0 (38)	0.25	99.7

ESRX

I want to share with you a little bit of a scary trade I made this week.  ESRX is a (PBM) Pharmacy Benefits Manager that has a very solid model, but currently is a bit volatile due to its pending merger with another (PBM) Medco Health.  Early in the week I sold contracts of March ESRX at strike price 42.5.  At the time ESRX stock was trading at around $52.  I sold the March 42.5 ESRX puts for .50.  What this means is that a $50 for each contract I sell, is credited to my account by the third Friday of March if the stock does not drop to this amount.

There was news regarding ESRX and the stock drop to a low of $47.5.  The option contract I sold for .50 more than doubled, my trade went bad.  If I bought back the put option I sold, instead of making the $50/contract in March, on Tuesday if I had to buy this contract back I would have to pay more than $100/contract.

I have some liberal rules, that if my trade goes wrong and I lose double on what I would earn I would get out of a trade.  These rules are liberal so even though this trade went against me, I was going to wait. A day later the stock has recovered and instead of losing $50 per each contract I sold, I am almost even.  I believe ESRX will be above the 42.5 strike price on the third week of March and that I will make money on this trade.  Traders who have good discipline are usually the great traders.  My discipline, is not too great but hopefully I will do ok in this trade.  Please let me know if there are any questions.  I understand this blog is a bit esoteric for option traders, but sharing my ideas is what I want to do.