Options
Open Interest — Definition & Example
The total number of outstanding option contracts at a given strike — a measure of strike-level commitment.
Open interest (OI) counts the contracts that exist at each strike, in contrast to volume which counts only contracts traded today. Rising OI alongside rising premium suggests new buyers entering. Falling OI suggests existing positions closing. OI builds at strikes where the market has commitment; large OI strikes often act as price magnets near expiry.
Example
NIFTY 24500 CE has 5,00,000 contracts of OI; 24700 CE has 1,00,000 OI. The 24500 strike is far more crowded — closing prints near it can have outsized impact on retail option holders.
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