SI
SI
discoversearch

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor.  We ask that you disable ad blocking while on Silicon Investor in the best interests of our community.  If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.
Technology Stocks : USRX
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  
To: David Lawrence who wrote (15309)3/14/1997 3:02:00 PM
From: Glenn D. Rudolph   of 18024
 
Nope - at least I don't think so. If there is another writer of a
contract who wants to exit, you might simply take over their position
and they will pay you the premium, i.e. buy back their obligation. In
that secnario, no change in open interest.

Dave,

I do not believe you are exactly correct here but your end result is correct. The open interest is the entire number of open contracts. Thus, when one sells a contract to open contract that does add one to open interest. However, in the example you stated the net open interest will not change. The process here is the original writer closes his/her contract changing open interest by -1 but the new writer opens a contract giving a +1. The net change is 0 but the new writer actually added one to open contracts and that would have remained as an additional open interest except for the fact the first person closed their position.
Report TOU ViolationShare This Post
 Public ReplyPrvt ReplyMark as Last ReadFilePrevious 10Next 10PreviousNext  

HomeMailHotSubjectMarksPeopleMarksKeepersSettings
Terms Of UseContact UsCopyright/IP PolicyPrivacy PolicyAbout UsFAQAdvertise on SI
© 2025 Knight Sac Media.  Data provided by Twelve Data, Alpha Vantage, and CityFALCON News