Position Closed in Lam Research Corp.

Yesterday, Lam Research reported their 2nd quarter 2019 earnings. They beat consensus earnings and revenue and also provided a positive outlook on their prospects. The market responded this morning with a large upward price spike and when the stock reached $157.43 ($18.10 above yesterday's closing price), the Covered Calls Advisor closed the position by simultaneously selling the 200 LRCX shares and buying back the two shorted Feb15th, 2019 $145.00 Call options.

As detailed below, this Lam Research position achieved a return-on-investment result of +9.2% absolute return in 24 days (equivalent to a +140.6% annualized return-on-investment).


Lam Research Corp. (LRCX) -- Covered Calls Position Closed
The transactions were as follows:
01/01/2019 200 LRCX shares owned at $136.17 per share
01/07/2019 Sold 2 LRCX Feb 15, 2019 $145.00 Call options at $5.35 per share
01/24/2019 Closed LRCX Covered Calls position by selling 200 LRCX shares at $157.43 and simultaneously buying back the 2 Feb 15th $145.00 Calls at $14.43 per share.  


The overall performance result (including commissions) was as follows:
Covered Calls Cost Basis: $26,164.00
= ($136.17 - $5.35) * 200 shares

Net Profit Components:
(a) Option Income: -$1,828.58
= ($5.35 -$14.43) * 200 shares - 2*$6.29 commissions
(b) Dividend Income: +$0.00
(c) Capital Appreciation: +$4,247.05
= ($157.43 -$136.17) * 200 shares - $4.95 commission

Total Net Profit: +$2,418.47
= (-$1,828.58 options income +$0.00 dividend income +$4,247.05 capital appreciation)

Absolute Return: +9.2%
= +$2,418.47/$26,164.00
Equivalent Annualized Return: +140.6%
= (+$2,418.47/$26,164.00)*(365/24 days)