Open Interest

Open Interest
1. The total number of options and/or futures contracts that are not closed or delivered on a particular day.

2. The number of buy market orders before the stock market opens.

1. A common misconception is that open interest is the same thing as volume of options and futures trades. This is not correct, as demonstrated in the following example:

Open Interest

-On January 1, A buys an option, which leaves an open interest and also creates trading volume of 1.
-On January 2, C and D create trading volume of 5 and there are also five more options left open.
-On January 3, A takes an offsetting position, open interest is reduced by 1 and trading volume is 1.
-On January 4, E simply replaces C and open interest does not change, trading volume increases by 5.

Investment dictionary. . 2012.

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Look at other dictionaries:

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  • Open interest — The total number of derivative contracts traded that not yet been liquidated either by an offsetting derivative transaction or by delivery. Related: liquidation * * * open interest ˌopen ˈinterest noun [uncountable] FINANCE in futures (= buying a …   Financial and business terms

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  • Open interest (futures) — Open interest is the number of open contracts of derivatives like futures and options that have a time limit after which they expire. Open interest in a derivative is the sum of all contracts that have not expired, been exercised or physically… …   Wikipedia

  • open interest — noun The number of contracts outstanding between market participants in a futures market or other derivatives market …   Wiktionary

  • open interest — noun : the total in physical units of outstanding long and short futures contracts on a commodity exchange …   Useful english dictionary

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