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Rule 80A
(redirected from Downtick Rule)

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Rule 80A
On the New York Stock Exchange, a rule restricting the trade of S&P 500 Index stocks when the Dow Jones Industrial Average index has gained or lost more than 2% from the previous trading day. This is done to prevent wild swings in index prices that might result from speculative investing. Rule 80A exists to attempt to maintain stability in share prices. It is also informally called the Uptick/Downtick Rule and the Collar Rule.

Rule 80A
A New York Stock Exchange rule that restricts program trading orders for Standard & Poor's stocks as part of index arbitrage strategies in the event the Dow Jones Industrial Average moves up or down 2% from its previous closing value. The rule requires that executions take place in a manner that stabilizes share prices. Rule 80A is intended to dampen large market-wide swings. Also called collar rule, index arbitrage tick test, uptick/downtick rule.


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