Chapter 04 · Section 4.1
Put Open Interest/Volume
Day 1 Al buys 5 Sep 35 calls. Sam sells 2 Sep 35 calls. Tim sells 3 Sep 35 calls.We just determined call open interest and volume. What are the put open interest and trading volume at the end of day 1?ABC Stock Options CALL PUT Open interest : 5 Open interest : Trading volume: 5 Trading volume:
a) 5 & 5
b) 0 & 0
c) 0
d) 5
e) 5
f) 0 & 10
Open interest is the number of outstanding contracts in a given market. Outstanding means not yet offset.
How many put options contracts have been initiated during the first day? How many put options contracts were already open before the first day?
Each opening transaction adds to the open interest and each closing transaction decreases the open interest.