Fluctuation limit

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Fluctuation limit

The limit created by the commodity exchange that halts trading on a future if the price of the future changes, in either direction, more than a previously set amount. Also called daily price limit.

Fluctuation Limit

On a futures exchange, the maximum amount that a contract can rise or fall in price before the exchange's management institutes suspended trading. Trading on a security is suspended usually in order to discourage volatility. This is especially important for futures contracts and options, which are almost always volatile.

References in periodicals archive ?

In order to maintain a stable stock market, we have set the daily price fluctuation limits of stocks, at a maximum limit 15% of the closing price and a minimum of 10%.

ADX adopts pre-closing session call auction

Dubai: Dubai Financial Market (DFM) , the only Gulf stock market to sell shares to the public, introduced unified fluctuation limits and cut the maximum weighting of a company in the benchmark index to 20 per cent.

DFM revises price fluctuation ceiling

Opponents against price fluctuation limits argue that they serve no purpose other than to slow down or delay the price change.

Effect of price limits on volatility and stock returns in emerging markets: evidence from the Johannesburg stock exchange

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