Limit Down - futures trading

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Limit Down

The maximum amount by which the price of a commodity futures contract may decline in one trading day. Limit down also refers to the maximum decline permitted in individual stocks on certain exchanges before trading curbs kick in. The limit is generally set as a percentage of the market price of the futures or stock, and occasionally as a dollar amount. These limits were introduced to counter unusual market volatility and prevent panic-driven selling.

Read more: Limit Down Definition | Investopedia

See also Limit Up and LULD
Created by  steve2222 , December 20th, 2015 at 07:44 AM
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Limit Up  steve2222  Terms (Glossary) 0 December 20th, 2015 07:43 AM

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