Finance:Price limit
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Short description: Established amount of increase or decrease of a price in a given trading day
A price limit is an established amount in which a price may increase or decrease in any single trading day[1] from the previous day's settlement price.
In financial and commodity markets, prices are only permitted to rise or fall by a certain number of ticks (or by a certain percentage) per trading session.[1] Similarly, index futures are often permitted to move a certain amount before the cash market opens.[2]
References
- ↑ 1.0 1.1 "Daily Price Limits". http://www.oxfordfutures.com/futures-education/price-limits.htm. Retrieved February 24, 2012.
- ↑ Stock Index Price Limits, http://www.cmegroup.com/trading/equity-index/files/PriceLimitGuide.pdf, retrieved January 3, 2012
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