Open Interest

Open interest is the total number of contracts of a specific option currently open — bought or sold and not yet closed, exercised, or expired. It's different from volume, which counts contracts traded in a single session and resets every day; open interest instead carries forward, rising as traders open new positions and falling as they close existing ones. A contract can see low volume on a quiet day but still carry high open interest from positions opened weeks earlier, or see a huge volume day that barely moves open interest if much of it was same-day opening and closing. Traders read open interest alongside volume as a rough liquidity gauge — higher open interest generally means tighter spreads and an easier time entering or exiting without moving the price much.