L&T Gave 17,488% Gain In One Day (?)

Equitymaster gas released post that investor in put and call options of L&T made 17,488% gain in one day. Is it possible? Anybody has done it? How to deal in put and option? Is it safe or very dangerous?

The buyer makes money if the stock (in this case L&T) is trading above the strike price on the day of expiry (which was May 26). The contract becomes worthless after expiry.

On May 25, these rights were selling for a meagre Rs 0.4 as the stock was trading much lower than the strike price of 1,400 and the probability of stock moving up above 1,400 were low.

But the stock did make a large move against everyone's expectations on May 26 and so did the call options of the stock. They made an even larger move resulting in a huge profit for the buyers.

https://www.equitymaster.com/5MinWr...tle=17488-Gains-in-a-Day&utm_source=short-url