The account used a strategy for the first time on this recent close of one trade and open of another trade on the same stock.
When tracking the trade last Friday, the account noticed that the Dec $10 call on LLEN had only $0.05 of time value left. The stock at the time was priced at $12.45. When the account noticed that, it researched and found that the Jan 2011 $12.50 call was bid at $1.15.
The account acted in the following manner:
1) The account closed out the Dec $10 call by buying it back.
2) The account sold the Jan 2011 $12.50 call for $1.15.
It moved the cost basis for the trade to $ 11.04 per share. This is calculated by taking $9.79 original purchase plus $2.65 for the Dec call buy back minus $1.40 for the call premium received ($0.40 for the dec call and $1.00 for the January call).
This strategy was implemented because the account saw the high value of the Jan 2011 $12.50 call. It wanted to capitalize on it. It saw that there was a small fraction of time value left on the ask of the Dec $10 call. The account had the cash reserves to close the Dec trade. So the account acted and is now in a good position to continue moving the account value higher using the call selling strategies.