Why NSE Nifty Options OI not becomes ZERO after expiry

@nithin… At the or After the Expiry logically there should be " ZERO" OI as all the open contracts should get closed…but NSE NIFTY data as per attached snapshot shows lot of OI values for various strikes.
Can somebody explain what is this…why OI not shows ZERO OR negligible values (which contracts are left open)

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Options r auto closed at 330 pm, since mkt is closed, they dont update that auto closure in option chain

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Hello @trade123

  1. OI becomes zero ONLY if the options are squared off before 330. It DOES NOT become zero if the options are not closed out and left to expire wortheless/ exercise
  2. Most of the ATMs/ OTMs near ATM are not square off by the trades, as you can see from the Option Chain. This is because there is money to be made till the very last moment, especially at the ATM.
  3. Squaring off involves charges if you are not on a discount broker like Zerodha.
    I had shorted 10800 CE and 10750 PE yesterday at 1 PM and it was worth around 15 Rs. At 315, they were worth around 20 paise. I closed out my positions because I didnt want to take the risk for 20paise, and the charges of expiry versus Zerodha trading charges were about the same. But for many people (read non discount broker users) the square off charges are so high that they would rather keep it open till the very end. And it will remain as open interest.
  4. Bonus: STT trap also causes sellers to let the options expire rather than square off. So if you have an ITM option, which is slightly profitable but less than STT, the buyer wont exercise

So not all options are squared off, they remain open at 330, and that is why there is OI. Hope that helps :slight_smile: