What is Open Interest ? How does it effect a stock price ?

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What is Open Interest ? How does it effect a stock price ?

2006-12-07 16:05:43 · 2 answers · asked by Priyesh K 1 in Business & Finance ➔ Investing

2 answers

In options, it represents the number of contracts outstanding. There are lots of possible reasons for this, and it does not mean the stock is going up or down. It does mean that there are few investors interested in the stock. So when you buy or sell shares, the Bid-Ask spread will be large. If it is a great company that does not matter, as your gains will rapidly cover the spread.

Best of success.

2006-12-09 16:00:32 · answer #1 · answered by Thinker 5 · 0⤊ 0⤋

not affect

just a no of contract in respective period

2006-12-08 00:38:14 · answer #2 · answered by dinu_pawar 5 · 0⤊ 0⤋