We have 3 last positions that we need to manage before the weekend.

TRADE ROLL

AbbVie Inc. (ABBV):  164.84

AbbVie stock price has traded higher since early November on no real news and even against the anticipated fear of Humira coming off patent in January. The stock has reached a resistance level around 165 and may see further selling as we close in on the Humira generic date.

With the price run-up we haven’t been able to keep up rolling our calls higher. We can roll our current 9 Dec 152.50 call out two weeks and collect a credit. Let’s do that while closely watching for signs that the stock may sell off before the end of the year.

ACTION:  Roll ABBV 9 Dec 152.50 call to the ABBV 23 Dec 152.50 call for a net credit of around 0.45 to 0.50

Buy to close ABBV 9 Dec 152.50 call

Sell to open ABBV 23 Dec 152.50 call

TRADE ROLL

CF Industries (CF):  100.01

CF stock has wobbled lately but nothing has changed fundamentally. Continued strong demand for fertilizer products will keep the CF momentum going. Let’s roll our call out one week and down a strike for a good credit.

ACTION:  Roll the CF 9 Dec 100 put to the CF 16 Dec 99 put for a net credit of around 1.75 to 1.80 and a 1.8% return

Buy to close CF 9 Dec 100 put

Sell to open CF 16 Dec 99 put

TRADE ROLL

Vale S.A. (VALE):  17.00

Vale stock has outperformed the S&P 500 since October as demand picked up from Asia, and specifically China. Iron ore futures in China rose to a six-month high today, as the top steelmaking country’s easing of Covid-19 restricts lifted hopes of an increased demand. As the China easing continues, some analysts believe iron order futures could go as high as $150 a ton.

Vale is well position to take advantage of this move and we want to continue to generate income from this stock in 2023. However, the pace of the stock price is making it harder to roll our calls higher and collect a credit. Let’s roll our 9 Dec calls out at the same strike for a smaller credit and if the stock retraces, we can roll higher.

ACTION:  Roll VALE 9 Dec 15.50 call to the VALE 23 Dec 15.50 call for a net credit of around 0.10 to 0.12

Buy to close VALE 9 Dec 15.50 call

Sell to open VALE 23 Dec 15.50 call