Select an option above to see an explanation here.

A) This answer is incorrect because open interest does not refer to the number of open positions but the total number of outstanding contracts.
B) This answer is incorrect because open interest is not about the number of contracts traded but not yet liquidated.
C) This answer is incorrect because open interest doesn't indicate the total number of contracts bought or sold but the total number of outstanding contracts.
D) Open interest reflects market sentiment and predicts trends.