Options on futures give buyers the right, not the obligation, to assume a position in the underlying futures market at a specific price any time before the option expires.
Open interest is the number of contracts outstanding at the close of trading each day.
It can indicate the use of risk management instruments by institutions and individuals with a long-term stake in the markets, as well as liquidity of a contract. The continuing growth in open interest in recent years suggests that customers increasingly find options a valuable hedging tool. Chicago Mercantile Exchange Inc. offers a variety of futures and options products on livestock, dairy and forest products. As part of its agricultural complex, CME trades contracts on live cattle, feeder cattle, stocker cattle, lean hogs, pork bellies, milk, butter, lumber and oriented strand board.