Suspended trading

(redirected from Trading Halts)

Suspended trading

Temporary halt in trading in a particular security, in advance of a major news announcement or to correct an imbalance of orders to buy and sell.

Suspended Trading

A situation in which trading on a security is halted, usually for about half an hour, but sometimes longer, by the exchange's management or by regulators. Trading on a security is suspended usually in order to discourage volatility. For example, suspended trading may occur for the period immediately around a major announcement by the company's management that may cause the price to unsustainably rise or fall. Likewise, the SEC may suspend trading on a security if it is thought to be engaged in illegal activities.

suspended trading

The temporary suspension of trading in a security. Trading in a security may be suspended if, for instance, a major announcement by the issuing company is expected to influence significantly the security's price. The temporary halt in trading is intended to give the financial community enough time to hear the news. Also called trading halt.

Suspended trading.

Suspended trading means that an exchange has temporarily stopped trading in a particular stock or other security.

Trading is typically halted either because an important piece of information about the issuing company is about to be released or because there's a serious imbalance between buy and sell orders, often triggered by speculation.

In the case of an expected announcement, the affected company generally notifies the exchange that the news is imminent. The suspension, or trading halt, provides time for the marketplace to absorb the announcement, good or bad, and helps reduce volatility in the stock price.

Examples of news that could cause a suspension are a poorer than expected earnings report, a major innovation or discovery, a merger, or significant legal problems. The Securities and Exchange Commission (SEC) can also suspend trading in the stock of a company it suspects of misleading or illegal activity.

References in periodicals archive ?
The firm, he adds, is pleased to see how Cboe handled the first week's trading, especially dealing with multiple trading halts due to the price surge on the first day.
CBOE reported two trading halts overnight of CBOE Bitcoin Futures (XBT) due to heavy demand.
The European Securities and Markets Authority (ESMA) has issued today the final report on the Guidelines regarding the calibration of circuit breakers and the publication of the trading halts under the Markets in Financial Instruments Directive (MiFID II).
Other markets have one threshold: There is only a temporary shut down at 10 percent and no other trading halts thereafter.
The halt follows a previous 15 minute hold on trading after a drop of five per cent, under a new system which implements automatic 15 minute trading halts in order to limit volatility.
This study investigates the impact of price limits and trading halts (circuit breakers) on the returns volatility of the Nigerian equity markets during the market meltdown occasioned by the Global Financial and Economic Crises of 2007-2010.
Roger Edelen and Simon Gervais, University of Pennsylvania, "The Role of Trading Halts in Monitoring a Specialist Market"
Those who control the market may initiate tighter margins, trading halts and more governmental oversight.
For one thing, much of the early selling was from orders left over from the previous day, when the market's precipitous fall triggered - twice - the trading halts known as circuit breakers, which had never been tripped before.
A variety of trading halts are in place on exchanges around the world.
In contrast to trading halts, the Securities and Exchange Commission (SEC) is authorized under federal law to suspend trading in any stock for a period of up to 10 business days when it believes that the investing public may be at risk.