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.