open position meaning
Download PDF

Open Position Meaning and Example

Definition of Open Position – A trade or transaction that yet need to be closed with an opposite trade or transaction.

Open Position Meaning – Well, in trading open position refers to the position of an investor when he still requires to do an opposite transaction to close the trade. As we all know that trading of shares involves buying and selling. In both the cases the position remains open till the investors does not execute an opposing trade.

Open Position Example

In order to understand open position meaning, let’s discuss an example in detail.

Suppose Ram owns 200 shares of Infosys Ltd. This means that he has the open position. Till Ram did not sell the shares to the desired buyer, his position will remain open. Now suppose, at the end of trading session, he got a buyer and he clears of the shares. Now Ram’s position has been closed and the trade has been completed.

Related Financial Terms of Open Position