Categories: Stocks

Daily Price Limit

A Daily Price limit is the maximum price limit permitted for a trade in futures contract in a single trading session when compared with its settlement price from the previous day. The maximum permitted price during a trading day is known as ‘Limit Up’ and the maximum permitted price decline during a trading session is referred to as ‘Limit Down’. Daily price limits are examples of circuit breakers or curbs on trading, put in place by exchanges to help maintain conducive trading conditions, especially during volatile markets or when there is some specific news or during extraordinary conditions prevalent in markets. Stock exchanges impose these limits to protect traders/investors from extreme price fluctuations and also to prevent potential price manipulation practices. Trading can continue even after the daily price limit has been reached, but the price will not cross the maximum limit set for the day.

abhilash.st

Share
Published by
abhilash.st

Recent Posts

PPF calculator

A PPF calculator is an online tool that helps you calculate the maturity amount at…

1 year ago

Non-Resident Indian (NRI) PPF Account

Non-resident Indians are not allowed to open a new PPF account. However, if a resident…

1 year ago

Minor Account

A PPF account can be opened by a parent or guardian on behalf of a…

1 year ago

Joint Account

PPF rules do not allow joint accounts. An account can only be opened in the…

1 year ago

Extension of PPF Account:

After the maturity of the PPF account, you have the option to extend it for…

1 year ago

Withdrawal

From the 7th financial year onwards, you can make partial withdrawals from your PPF account.…

1 year ago