Nifty Open Intrest

Hi All,
The traders who are trading in F&O Space must be familiar with this term,But many novice traders might not be having full knowledge and the benefits of Open Interest.I have compiled this article to have more clarity on OI and its use in trading.

What is Open Interest?

Open Interest is the total number of outstanding contracts that are held by market participants at the end of the day.
It can also be defined as the total number of futures contracts or option contracts that have not yet been exercised (squared off), expired, or fulfilled by delivery.
Open interest applies primarily to the futures market. Open interest, or the total number of open contracts on a security, is often used to confirm trends and trend reversals for futures and options contracts.
Open interest measures the flow of money into the futures market. For each seller of a futures contract there must be a buyer of that contract. Thus a seller and a buyer combine to create only one contract.

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