Open Interest
Open interest is the total number of option contracts that are currently outstanding and not yet closed or exercised.
It rises when a new buyer and seller open a contract and falls when positions are closed. Unlike volume, it is a running total, not a daily count.
High open interest signals a liquid, actively held strike and usually tighter bid-ask spreads.
Example. If the 100-strike call shows 5,000 open interest, 5,000 contracts (500,000 shares of exposure) are currently held across all traders.
FAQ
What is the difference between open interest and volume?
Volume counts contracts traded during the day; open interest is the cumulative number of contracts still open.
Why does open interest matter?
Higher open interest generally means better liquidity and tighter spreads, making positions easier to enter and exit.