04 December 2008
IN CASH OF DERIVATIVES (OPTION AND FUTURE): OPEN INTEREST MEANS: SUPPOSE YOU HAVE BOUGHT AN OPTION ON 25 TH OF MARCH OF MAY SERIES. (AT A TIME THERE MAY BE 3 MONTHS SERIES. IN THE MONTH OF MARCH YOU CAN BUY A OPTION OF MARCH, APRIL OR MAY SERIES. AND A MONTH SERIES WILL BE SQUARED OFF ON THE LAST THURSEDAY OF THE MONTH) NOW YOU HAVE PAID PREMIUM ON 25TH MARCH. AND YOUR RISK IS OPEN IN THE YEAR END IE ON 31ST MARCH.ON 31ST MARCH THE PREMIUM MAY BE HIGH OR LOW OF THE OPTION OF MAY SERIES. IT IS CALLED OPEN INTEREST.
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