Open Interest vs Volume: Understanding the Key Differences
Learn the difference between Open Interest and Volume, how traders use each metric, and why understanding both is important for option chain analysis.
Open Interest and Volume are two of the most commonly used metrics in options and futures trading. Although both appear in option chains, they measure different aspects of market behaviour.
What Is Open Interest?
Open Interest represents the total number of active derivative contracts that remain open. It is commonly used as a participation indicator.
What Is Trading Volume?
Volume measures the number of contracts traded during a specific period. It reflects trading activity rather than active positions.
The Core Difference
Open Interest measures active contracts, while Volume measures traded contracts. Open Interest tracks participation (how much capital is committed); Volume tracks activity (how fast trades are executing).
Volume resets to zero at the start of each individual trading session. Open Interest is cumulative; it only changes as new contracts are created or existing positions are closed out. Option chain analysts combine both to study trends and determine support or resistance walls.