Understanding OI-to-Market-Cap Ratios
Some third-party reports have described SHELL's derivatives open interest as relatively high compared with its reported market capitalization.
This ratio can provide context about how much derivatives exposure exists relative to the estimated spot-market value.
However, the calculation is sensitive to both OI and circulating-supply methodology. Different market-cap estimates can produce very different ratios.
It is therefore important to check the underlying numbers before interpreting a high OI-to-market-cap ratio as excessive leverage.
#SHELL #OpenInterest #RiskAnalysis
Some third-party reports have described SHELL's derivatives open interest as relatively high compared with its reported market capitalization.
This ratio can provide context about how much derivatives exposure exists relative to the estimated spot-market value.
However, the calculation is sensitive to both OI and circulating-supply methodology. Different market-cap estimates can produce very different ratios.
It is therefore important to check the underlying numbers before interpreting a high OI-to-market-cap ratio as excessive leverage.
#SHELL #OpenInterest #RiskAnalysis