Options Basics

Futures Basics

Bullish Strategies

Bearish Strategies

Neutral Strategies

Synthetic Positions

Options Arbitrage

Open Interest

The open interest is the total number of open contracts outstanding in a particular option series and this figure is tracked by the options exchanges. Every opening transaction increases the open interest by 1 while every closing transaction decreases the open interest by 1.

This value is useful for determining the liquidity for a particular options series. A large open interest indicates a more liquid market and making large trades will be less of a problem.