Wall Street & Technology is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.


06:58 AM
Connect Directly

New Limit Up/Limit Down Rules Start Today

New limit up/limit down rules will add additional complexities to the markets in an attempt to curb volatility. Let's see how they actually work.

The rollout of the new Limit Up Limit Down will commence on Monday, April 8th, 2013.

The proposed new introduction of limit-up / limit–down will try to limit extreme price movements in an already burdened market with excess directional market influences.

-- The use of Limit-Up Limit-Down exacerbates trading within specific ranges in order to help facilitate decreased volatility.
-- Traders will experience these buffers before trading halts actually occur.
-- These rules have already been in effect for many years in a number of foreign markets.
-- In volatile names, quotes at the NBBO may fall outside the limit bands and therefore will not be executable.

Let’s see what this new scale of trading limits will bring to already convoluted and fragmented market here in the U.S. Michael J. Levas has been in the investment management business for over 25 years and is the founder, senior managing principal & chief investment officer at the Olympian Group of Investment Management Companies. Prior to Olympian, he was a VP and Portfolio Manager in the ... View Full Bio

Register for Wall Street & Technology Newsletters
Stressed Out by Compliance, Reputational Damage & Fines?
Stressed Out by Compliance, Reputational Damage & Fines?
Financial services executives are living in a "regulatory pressure cooker." Here's how executives are preparing for the new compliance requirements.