Locked Limit Down

(redirected from Locked Limits Down)

Locked Limit Down

A price that a futures contract may not drop below on a given trading day. For example, if the locked limit down is $25 for a given contract and it previously had been trading at $28, the exchange will not allow the contract to trade below $25. A futures exchange sets a lock limit in order to protect investors from the excessive volatility often involved in futures trading.