$29 BUY $1.50 SELL $3.00 PROFIT $1.50 %GAIN=100%
Came across this example of investopedia. If anyone can explain how they found the percentages would be great.
"In the case of a stock that is trading at $30, a one-month call with a $29 strike may be priced at $1.50, while a one-month call with a $31 strike may be priced at 40 cents. If the stock appreciates to $32 by option expiry, the $29 call would be trading at about $3.00, while the $31 call would be priced around $1.00. In this case, the gross return of 150% for the $31 call is well above the 100% return for the $29 call."
