Option Chain

Q: What is an option chain?

An option chain is the table that lists every call and put contract on one underlying for one expiry, one row per strike. Calls are conventionally on the left, puts on the right, strikes down the middle. For each contract it shows the last price, bid and ask, volume, open interest, the change in open interest and implied volatility. It is the primary screen for anyone trading options.

Q: What do open interest and change in OI tell me on the chain?

Open interest is the number of contracts outstanding at that strike; its change over the day shows where new positions were built or closed. Strikes with the largest call OI are commonly read as resistance and the largest put OI as support, on the reasoning that option writers dominate OI and defend their strikes. Rising OI with a rising price suggests fresh longs; rising OI with a falling price suggests fresh shorts.

Q: Why do the shaded strikes differ between calls and puts?

The shading marks in-the-money contracts. For calls, strikes below the spot price are in the money; for puts, strikes above the spot are. So the shaded band sits on the lower-left and upper-right of the chain, meeting at the at-the-money strike near the current index level.

Q: How is the put-call ratio read from the chain?

Sum the put open interest across strikes and divide by the summed call open interest for the same expiry. A ratio well above one means more puts are outstanding than calls, commonly read as hedged or bearish positioning that can be contrarian-bullish at extremes; well below one means the reverse. The ratio is also computed on volume, which reads the day's flow rather than the standing positions.

Q: Which expiry's chain should I look at?

The nearest expiry carries most of the volume and the clearest positioning readings: on NIFTY the current Tuesday weekly, on Bank Nifty the current monthly. Longer expiries show how the market is positioned beyond the week, but their open interest is thinner and their implied volatility less reliable at far strikes.

Every strike, both sides, one expiry. The chain is the options market laid out in a single table, and the positioning readings traders talk about are all taken from its columns.

In short: an option chain is the table of all call and put contracts on one underlying for one expiry, one row per strike. Each side shows the last traded price, bid and ask, volume, open interest and its change, and implied volatility. The chain is where traders find the price of a contract, and also where they read positioning: the strikes with the heaviest open interest, the put-call ratio, the shape of IV across strikes and the max pain level.

The layout

The convention, used by NSE and nearly every broker, is calls on the left, strikes down the centre, puts on the right. Each row is one strike; each half-row is one contract. Reading across a row gives the full picture at that strike: what a call costs, how many are outstanding, what a put costs, how many of those are outstanding. Reading down a column gives the distribution across strikes: where open interest piles up, where volume concentrated today, how implied volatility rises away from the money.

In-the-money contracts are shaded. For calls these are strikes below the spot; for puts, strikes above it. The two shaded regions meet at the at-the-money strike, which is the chain's centre of gravity and usually its busiest row.

What each column means

Column	Meaning	What traders use it for
LTP	Last traded price of the contract	The premium; stale at illiquid strikes
Bid / Ask	Best buy and sell quotes	Real cost to trade; the spread is a liquidity measure
Volume	Contracts traded today	Where today's activity is
OI	Contracts outstanding	Where standing positions sit; support and resistance reading
Change in OI	OI now minus previous close	Where positions were added or unwound today
IV	Implied volatility from the LTP	How expensive the strike is; the smile
Change	Premium change on the day	Paired with OI change to classify the flow

Worked reading (illustrative numbers)

Suppose NIFTY is at 24,000 with six days to the Tuesday weekly, and the chain shows this around the money:

Call OI (lakh)	Call LTP	Strike	Put LTP	Put OI (lakh)
8	₹620	23,500	₹28	42
14	₹340	23,800	₹55	31
27	₹185	24,000	₹160	29
38	₹78	24,200	₹300	12
61	₹24	24,500	₹560	6

Three things stand out. Put open interest is heaviest at 23,500, call open interest at 24,500: on the usual reading these are the week's support and resistance, the levels where writers have the most to defend. Total put OI across these rows (120 lakh) divided by call OI (148 lakh) gives a PCR of 0.81, a mildly call-heavy book. And the at-the-money straddle costs ₹345, which at a 24,000 spot is a 1.4% expected move to Tuesday; the market is not pricing anything dramatic. None of this is a forecast; it is a description of where positions are, which is the starting point for any view.

The two open-interest walls bracket the spot. Writers hold most of that interest, so the walls mark where the largest positions would start to lose money.

Why it matters to an options trader

It is the price list. Every premium, spread and liquidity judgement starts here. The bid-ask column tells you what a trade really costs; LTP alone does not.
It shows positioning, not just price. Open interest and its change are the only public record of where the market has committed money, and the chain is where they live.
It feeds every derived indicator. PCR, max pain, the IV smile, OI walls, straddle-implied expected move: each is a calculation on chain columns.
It frames expiry. On expiry day the chain's OI distribution describes where the pressure to pin or break sits, which is why the weekly's chain gets the most attention on Tuesdays.

Common mistakes

Reading OI walls as hard barriers. Heavy call OI at 24,500 is where writers would be hurt, and markets break through such levels regularly; a wall is a reference, not a ceiling.
Reading OI without price. Rising call OI with the premium falling is writers adding; with the premium rising it is buyers. The pair tells the story, not OI alone.
Trusting LTP at thin strikes. A far strike's last trade may be hours old. Its IV and change columns are computed from that stale print.
Looking at one expiry only. A monthly chain can carry walls at different strikes from the weekly; the two together show short and medium-term positioning.
Mistaking the chain for a signal. It is data. A reading of support, resistance or sentiment is an interpretation and should be treated as one.

Indian-market specifics

NSE publishes the chain for NIFTY, Bank Nifty, FinNifty, Nifty Midcap Select and every F&O stock, with OI in contracts; many displays convert to lots or to lakh for readability, and the NSE figure is in contracts of one lot each.
Strike spacing on NIFTY is 50 points near the money with wider intervals further out; Bank Nifty uses 100; open interest naturally clusters at round-number strikes.
The NIFTY weekly (Tuesday) chain is the most traded in India; Bank Nifty, FinNifty and Midcap Select have monthly chains only since November 2024.
Index options on NSE trade until 15:40 on expiry day, so the chain's final hour on a Tuesday runs ten minutes past the cash close.

FAQ

What is an option chain?

The table of every call and put on one underlying and expiry, one row per strike, with price, volume, OI and IV for each.

What do open interest and change in OI tell me on the chain?

Where standing positions sit and where they were added or unwound today; the heaviest strikes are read as support and resistance.

Why do the shaded strikes differ between calls and puts?

Shading marks in-the-money contracts: calls below spot, puts above it.

How is the put-call ratio read from the chain?

Total put OI divided by total call OI for the expiry, or the same on volume for the day's flow.

Which expiry's chain should I look at?

The nearest one for volume and positioning; later expiries for the longer view, with thinner data.

The chain, with the reading done

The NIFTY and Bank Nifty option-chain pages show every strike with open interest, its change, IV and the derived PCR and max pain, from the latest close. In the app, OI Intelligence identifies the call wall and put wall for the expiry and classifies the open-interest change at each strike as a long or short build-up, unwinding or covering.

NIFTY option chain Bank Nifty option chain

Related terms

Open Interest, the chain's most-watched column
Put-Call Ratio, the ratio computed from it
Max Pain, the strike where option holders lose most
How to read an option chain, the longer guide