price limits

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Related to price limits: Daily price limit


1. The maximum amount of price change a futures contract is allowed to undergo on a given trading day. Limits are mandated by the exchanges on which futures contracts trade, and exist in order to reduce volatility in the market. It is also called a trading limit.

2. The maximum number of transactions in commodities that an individual may make on an exchange on a given trading day. Limits are mandated either by the Commodity Futures Trading Commission or by the exchanges on which commodity contracts trade. It is also called a trading limit.

3. See: Limit order.

Price Limit

price limits

For a given futures contract, the maximum price change from the previous day's settlement price that is permitted during a trading session. These limits are sometimes adjusted in fast-moving markets.
References in periodicals archive ?
Table 3 presents an analysis of day-end and intra-day returns for the full sample and the subsamples: (1) firms that trade freely with no price limits, and (2) firms that trade with 5% symmetric price limits.
The current price limits for all water companies were set in November 1999 but the regulatory system allows firms to ask Ofwat to review their pricing if there are major financial changes.
The price limit is set for a period from 1 January to 30 June 2015.
The Nigerian Stock Exchange (NSE) introduced daily stock price limits and trading halts as a way of stabilizing the stock market after it crashed following the global financial crisis in 2008.
Starting in the early nineties, price limits became commonplace in stock markets around the world (Table 1).
At the financial committee of the Legislative Yuan, Chi Shieve, TSE chairman, pointed out yesterday (March 15) that the existing price limit blocks the linkage of the domestic bourse with the international market, since the U.
SHARES in Midland water company Severn Trent fell today as the market digested tough price limits imposed by the consumer watchdog.
Ofwat will set final price limits in November next year.
The first policy in the study is a market stabilization regulation that imposes 10 percent price limits on daily stock price movements effective December 16, 1996.
Ofwat chairman Philip Fletcher said: 'When we set price limits companies argued strongly that they required more money to safeguard improvements to customer services and the environment.
Severn Trent said it had begun to put the matter right by raising prices pounds 7m less than allowed under 2006-07 price limits.