Daily price limit

Daily price limit

The level within many commodity, futures, and options markets are allowed to rise or fall in a day. Exchanges usually impose a daily price limit on each contract.

Daily Trading Limit

The maximum amount of gain or loss that can occur on a particular security or, more commonly, derivative on a trading day. Derivatives, currencies, and commodities can be extremely volatile investments. In order to prevent this volatility from spiraling out of control, options and futures exchanges enact daily trading limits stating that a security cannot rise or fall more than a certain percent in a given trading day. If a security reaches the daily trading limit, trading on that security is suspended for the remainder of the day. This is called a locked market. See also: Limit up, Limit down.
References in periodicals archive ?
The first one will be the relaxation of the daily price limit from the present 7%, to 10%.
The current daily price limit for CME Feeder Cattle futures is $3.
10) The day on which the IPO firm's closing price first falls within the daily price limit rather than the offering day is taken as the cutoff point.
Third is allowance for investors to engage in intraday trading, so as to hedge against higher investment risks associated with the increase of daily price limit.
In response to significant increases in prices and volatility in the market, we recently proposed daily price limit increases in Corn futures," said Tim Andriesen, Managing Director, Agricultural Commodities and Alternative Investments, CME Group.
These changes supercede the recent changes to the daily price limits for CBOT Wheat contracts and cap the maximum daily price limit, after two expansions, at $1.
25 per Contract) Daily Price Limit +/- 10% from previous settlement price with a 15 Minutes Cooling Off Period to be followed with an expanded limit of +/- 15% and will apply from the session beginning at 23.
05 limit, the daily price limit for the December 2003 contract only shall be expanded by $0.
However, a similar drop in indices in the Middle Eastern markets are unlikely due to the daily price limits set by most exchanges and [which] act as a intraday safety net.
9, 2011 /PRNewswire/ -- CME Group, the world's leading and most diverse derivatives marketplace, today announced it had received CFTC approval of its proposal to increase daily price limits for Corn futures and options.
CHICAGO, March 10 /PRNewswire-FirstCall/ -- CME Group, the world's largest and most diverse derivatives exchange, today announced that, pending CFTC approval, daily price limits will increase March 28, 2008, for corn, mini-sized corn, soybeans, mini-sized soybeans and soybean oil futures and options on futures contracts.