Glossary

Open interest: meaning, example and why it matters

The total number of outstanding futures or options contracts that have not been closed or expired. It describes how many positions are open, not which way prices will move.

Worked example

Trader A sells 10 contracts to Trader B and both open new positions, so open interest rises by 10. If B later sells those 10 to Trader C, who is also opening, open interest stays at 10 because only the holder changed.

Illustrative numbers for explanation only. They are not market data, a forecast or a suggestion.

Why it matters

Open interest shows how many contracts are still open, not whether buyers or sellers are in control.

Related terms

FuturesCall optionPut option

See it in practice

F&O expiry datesHow to read an option chain

Frequently asked questions

Does rising open interest mean prices will rise?

No. It only shows that more contracts are open. Each contract has a holder on both sides.

Is this page investment advice?

No. Open interest is explained in general terms with illustrative numbers. Market Dekho is not a SEBI-registered Research Analyst or Investment Adviser.

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Educational content, not investment advice. Market Dekho is not a SEBI-registered Research Analyst or Investment Adviser. Spotted a mistake? Email marketdekho01@gmail.com.