Continuation of Covered Calls Position in Lam Research Corp.

Upon the September 21st, 2018 options expiration, the Covered Calls position in Lam Research Corp. (ticker symbol LRCX) expired with the stock price below the $165.00 strike price.  So, the September Call options expired and the 200 shares of Lam Research stock were retained in the Covered Calls Advisor Portfolio.  Today, with the price of Lam Research stock at $152.26, a sell-to-open order was executed to sell 2 December 21st, 2018 Call options at the $150.00 strike price for $5.80 per share to continue this Covered Calls position.

As detailed below, a potential return-on-investment for this Lam Research position is -1.5% absolute return in 127 days (equivalent to a -4.4% annualized return-on-investment).  

This position has an upcoming quarterly ex-dividend next Tuesday (Dec. 4th) of $1.10 per share which is included in the potential return-on-investment result for this position.  Given the Covered Calls Advisor's current Overall Market Meter indicator of Slightly Bearish, an at-the-money Covered Calls position was established.  The Covered Calls Advisor expects LRCX stock to move higher in the months ahead and will continue to sell at-the-money or slightly out-of-the-money monthly Call options going forward in an effort to return this position to profitability. 


Lam Research Corp. (LRCX) -- Continuation Covered Calls Position
The transactions to-date are:
08/17/2018 Bought 200 Lam Research Corp. shares @ $168.14
08/17/2018 Sold 2 LRCX 09/21/2018 $165.00 Call options @ $7.74
Note: a simultaneous buy/write transaction was executed.
09/06/2018 Quarterly ex-dividend of $1.10 per share
11/28/2018 Sold 2 LRCX December 21, 2018 $150.00 Call options @ $5.80
Note: price of LRCX stock was at $152.26 when these options were sold
12/04/2018 Upcoming quarterly ex-dividend of $1.10 per share


A possible overall performance result (including commissions) for this Lam Research Covered Calls position is as follows:
Covered Calls Cost Basis: $32,084.95
= ($168.14 - $7.74) *200 + $4.95 commission

Net Profit Components:
(a) Options Income: +$2,705.32
= ($7.74 +$5.80) *200 shares - 2*$1.34 commissions

(b) Dividend Income (If Lam Research shares assigned at Dec 21st, 2018 expiration): +$440.00
= ($1.10 dividend per share x 200 shares x 2 dividends)

(c) Capital Appreciation (If LRCX assigned at $150.00 strike price at options expiration): -$3,632.95
=($150.00-$168.14)*200 shares - $4.95 commissions

Total Net Profit (If Lam Research shares assigned at $150.00 at Dec 21, 2018 expiration): -$487.63

= (+$2,705.32 +$440.00 -$3,632.95)

Absolute Return (If Lam Research shares assigned at $150.00 at Dec 21, 2018 expiration): -1.5%

= -$487.63/$32,084.95

Annualized Return (If LRCX stock assigned at $150.00 at Dec 21, 2018 expiration): -4.4%

= (-$487.63/$32,084.95)*(365/127 days)