Open Interest is the total number of outstanding (Derivative) Futures & Options contracts. As the word Open Interest suggests, it is the amount of interest in any derivatives contract. It is different from volume.
Open Interest gives trades insights about support & resistance levels. It gives an indication of a trend or a reversal.Options Open interest is one of the most vital derivative data points used for analysis of the markets
Option Open interest is interpreted in a number of ways. Though every Call or Put contract has both Buyer & Seller, Options OI Data is inferred from the Option Sellers Perspective. This is because Option Sellers take more risk (unlimited loss risk) than the buyer (limited loss)
Get changes in Open Interest from a specific time in the day (up to the minute). This will help you track changes in Open Interest after a specific event, large move in the underlying.
We have tons of learning content on Youtube to make you a proficient Options trader. Open Interest Analysis is one of the widely used analysis methods in Indian Derivative Markets used to gauge sentiments. Learn from our video from Mrs. Tina Gadodia (President, Quantsapp), Mr. Rahul Prajapati (Head Trainer) & Mr. Shubhankar Patil.
Open interest is the number of outstanding contracts for a given security. It is used to measure the interest of an option contract. An option contract's open interest keeps varying based on how many traders are buying and selling it. The more traders entering into new contracts, the higher its open interest and the higher its liquidity.