OPEN interest on the Hang Seng Index options market is set to fall by 75 per cent tonight when the market has its first expiry. Open interest is a measure of the amount of contracts outstanding on the market, and some dealers had been worried that almost all the open interest had remained in the April contracts, which trade today for the last time and which last night had an openinterest of 4,968, out of the market total of 6,681. Relatively few contracts have been moved into the May options series, which last night had an open interest of 1,243. One dealer described the fall as ''worrying'', adding that in other options markets worldwide, institutions moved their positions forward very early to avoid decay, leaving only speculators trading the short month. Dr Virginia Mumford, manager for options and new products at the Futures Exchange, said ''the open interest doesn't really affect liquidity'' and it was too early to say that investors had tried the market and not liked it. Unlike futures, rolling positions into the next month was not a standard practice, she said. Investors might have held off from investing, waiting for the first expiry, and could move into the market after the settlement tonight. She said: ''After the expiry has happened they will be able to say, 'Yes, it works under all circumstances'. But I don't necessarily think we will see a quadrupling of business over the next couple of months.'' Dr Mumford said the expiry procedure had been extensively tested and expressed confidence in the expiry going smoothly. If the Hang Seng Index remains around last night's closing level, then more than half the April options will expire worthless tonight. However, some investors will see massive returns. Dr Mumford's belief that positions would not be automatically rolled over into the next month received qualified support from Mr Eric Cheng Kai-sum, a director of Worldsec, which sources say has established one of the largest client bases for options. He said rolling options contracts over was ''a much more strategic decision'' than the very common practice of rolling futures contracts over, and that options prices ''varied tremendously'' for different expiry months, unlike futures. He endorsed the view that the prices offered by different market-makers were very similar. ''I don't think they are competing,'' he said, adding that the entry of a large aggressive player to compete equally with SBC Derivatives was needed. The three other market-makers are Roctec, Peregrine and Cresvale. ''What we need is someone a bit crazy,'' Mr Cheng said, preferably a US company. As of last night, options were available at 16 prices for four months, both puts and calls, giving a choice of 128 options, although this will fall because the July month, which will replace April, will have fewer price options. To avoid market manipulation, tonight's settlement price will be calculated from a Hang Seng Index average calculated from samples taken every five minutes today.