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circuit breaker
(redirected from Magnetic circuit breaker)

    Also found in: Encyclopedia, Wikipedia, Hutchinson 0.03 sec.
Circuit Breaker
Refers to any of the measures used by stock exchanges during large sell-offs to avert panic selling. Sometimes called a "collar."

Notes:
After an index has fallen a certain percentage, the exchange might activate trading halts or restrictions on program trading. For example, if the Dow Jones Industrial Average falls by 10%, the NYSE might halt market trading for one hour. There are other circuit breakers for 20% and 30% falls.

circuit breaker
The automatic response, usually a halt or slowdown, in activity at an exchange in response to certain occurrences in trading. Circuit breakers are designed to reduce market volatility and were instituted following the large market breaks in October 1987 and October 1989. See also Rule 80A, suspended trading.


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