Open Interest Explained for Beginners

What open interest means and how students can use it as a learning input.

Open interest represents the number of outstanding derivative contracts that remain open. It is different from daily trading volume, which measures contracts traded during a period.

Students often combine price, volume and open-interest observations to study market behaviour. However, open interest by itself does not reveal a guaranteed direction.

Practice

Compare changes in price, volume and open interest across several sessions. Record what happened afterwards without turning the observation into a prediction. This develops research discipline.