If person A is 100 contract call long, B is 100 call short, C is 1 call long and D is 1 call short. Now when A & B close their position with each other, the volume will be 100. But since C&D still have open positions, so OI will be 75 (1 contract=75 shares). So volume=100 and OI=75.

SOMEONE CORRECT ME IF NEEDED.

Hi Subham,

Does it mean that if person A closes 50 contracts and person B buys those 50 contracts then the Volume will be 50.

And the OI will be (100-50)*75 for A & B + (1*75) – for C & D.

Am I right in my understanding.

Please help.

Thanks & Regards,
Anirban Deb

YES. YOU ARE RIGHT ACCORDING TO ME. but i am ready to be corrected if i am wrong else nitin sir will close this topic. Thank you.

Hi Shubham,

I also have one more query.
How to find big players’ position with OI and volume.
Though Nitin Ji explained in details in the Live streaming last Sunday, but I’m still a bit confused.

Is it OI or Change in OI?
Diner need to check if the value of OI/Volume is going up?
Nitin Ji also mentioned that when the OI Volume ratio is very little and OI on Call side is increasing, then we can assume that Big Players are being Long on Call.
But how to get that ratio?
And how to know if the ratio value is small?

Thanks & Regards,
Anirban Deb

dear friends
BUYER SELLER QUANTITY OI VOL
A(new) B(new) 50 50 50
C(new) D(new) 30 80 80
E(new) F(new) 100 180 180
G(new) H(new) 30 210 210
I(new) A(old) 50 210 260
B(old) J(new) 30 210 290
D(old) E(old) 30 180 320

Short Cut
Take N as new participant(one who wants to take fresh position) and O as old participant(one who wants to square up position)

then N to N oi increase volume increase equally
N to O
or O to N remain oi constant but volume increase by traded
contract
O to O oi decrease and volume increase with same contract

every scenario volume increase but oi may increase , remain constant or decrease

dear anirbandeb
here this ratio is relative not absolute so observe this ratio closely for one month and you will get idea.

Hi Hitesh,

Thanks for the clarification.

But how do I use this in intraday to find out the big players’position?

Thanks & Regards,
Anirban Deb

dear friend
when you find oi/vol ratio high relatively at that time big players are in action.

Hi Hitesh,

Thanks once again for the clarification.

Today, I have been tracking the OI and Volume data for both Call and Put.

The OI to Volume ratio on Call side started from 425 and started decreasing and is now at 61. The OI was also building on the Call side.

On the Put side, the OI to Volume ratio started from 523 and started decreasing and is now at 61. The OI was also building on the Put side.

What to conclude in this scenario?
Should we say the market is rangebound?

Please help.

Thanks & Regards,
Anirban Deb

dear
it’s not within my power so time to wait for nitin sir our so beloved bade bhaiya

No problem dear friend. Let’s wait for Nitin Ji.

In the meantime, if anyone can throw some light on this, it would be highly helpful.

And also, should we take the OI or the Change in OI for this ratio calculation?

And also, for the OI and Volume in question, are these the total OI and Volume for all the Strike Prices or the OI and Volumes of OTM?

Thanks & Regards,
Anirban Deb

Hi Hulmat,

Thanks for the clarification.
One question is, which IV are you referring to ? Call IV or Put IV?

Analysing the data I found that if the Call Premium goes up and the Call OI goes up and the Volume change increases but is very small (e.g. volume change was +19 and Call OI decreased by 61875 and Call Premium increased by 2.2) the market moved up. Someone closed their Short position on the Call side.

What I’m unsure is how to implement IV here? I mean which IV to consider here and what is the calculation or the logic?

Is it a combination of Call IV and Put IV. If yes, then what should be the logic?

Or is there any other logic?

Can someone please throw some light on this.

Thanks & Regards,
Anirban Deb

In continuation to my post above, I have also observed the following

Just before the above scenario occured, the Call IV and the Put IV were static. Call IV was at 40.43 and Put IV was at 40.68 for around 10 mins. Then they both decreased.

Interestingly, the correlation between Call IV and Nifty and Put IV and Nifty were positive for today. But, the IVs for both dropped and market moved up.

What to conclude from this.

Nitin Ji,

Please help.

Thanks & Regards,
Anirban Deb

Hi All,

The data I furnished above are for ATM strike.

Do I also need to look at the OTM data for IV, OI, Volume and Premium?

Thanks & Regards,
Anirban Deb

Any help from anyone would be highly appreciated.

Thanks & Regards,
Anirban Deb

Dear Anirbandeb,

Coincidentally, today i also had same doubt/query and we seek Nitin sir’s guidance on the same. I am analyzing OI and Volume relationship. i see there can be below scenarios:

1) OI increased & Volume increased
2) OI increased & Volume decreased
3) OI decreased & Volume increased
4) OI decreased & Volume decreased

We can definitely make out from OI/Volume ratio, if big players are playing or not, but need a conclusion on above scenarios.

Any guidance on above scenarios will be really helpful.

Regards,
Samir

Hi Samir,

As per Nitin Ji’s live streaming on 22-May-2019, he mentioned about some OI and Volume and stated that the big players are playing there. I observed that the OI and Volume he mentioned was around 4:1 ratio i.e. the OI was around 4 times than that of Volume.
Do you also take this ratio to determine whether the big players are in the game?
Or is there anything else I’m missing?

Please help.

Thanks & Regards,
Anirban Deb

I explained it in detail in one of the Live Streamings where i shared Bengaluru meetup learnings. Assume you are long on a particular strike price and i am short. We decided to exchange our positions i.e. you would like to take short position and i would like to go long. In this case, say we exchanged 5000 contracts between us. In this scenario, Volume will be 5000 but change in open interest will be zero as there is NO new position is created.