Chapter 04 · Section 4.1

Call Day 2

Here are all the transactions of day 2. (We keep the records of the first day because they still have an effect).

Day 1                        Day 2
Al  buys  5 Sep 35 calls.    Al  sells 8 Sep 35 calls.
Sam sells 2 Sep 35 calls.    Sam sells 1 Sep 35 calls.
Tim sells 3 Sep 35 calls.    Tim buys  9 Sep 35 calls.

                             ABC Stock Options
                    CALL                              PUT
               Day 1    Day 2                    Day 1    Day 2 
Open interest : 5        ...      Open interest : 0        ...
Trading volume: 5        ...      Trading volume: 0        ...

a) 14
• b) 9
  No. Your open interest figure is not correct. Open interest would be 9 if there had not been any trades on day 1. You must consolidate the open positions of day 1 with the transactions of day 2.
  c) 6 & 9
  d) 9
  e) 6 &12

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