A price limit is an established amount in which a price may increase or decrease in any single
trading day
In business, the trading day or regular trading hours (RTH) is the time span that a stock exchange is open, as opposed to Electronic trading hours, electronic or extended trading hours (ETH). For example, the New York Stock Exchange is, as of 2020 ...
from the previous day's
settlement price.
In financial and
commodity
In economics, a commodity is an economic good, usually a resource, that has full or substantial fungibility: that is, the market treats instances of the good as equivalent or nearly so with no regard to who produced them.
The price of a comm ...
markets, prices are only permitted to rise or fall by a certain number of
ticks
Ticks (order Ixodida) are parasitic arachnids that are part of the mite superorder Parasitiformes. Adult ticks are approximately 3 to 5 mm in length depending on age, sex, species, and "fullness". Ticks are external parasites, living by ...
(or by a certain percentage) per trading session.
Similarly,
index futures
In finance, a stock market index future is a cash-settled futures contract on the value of a particular stock market index. The turnover for the global market in exchange-traded equity index futures is notionally valued, for 2008, by the Bank for ...
are often permitted to move a certain amount before the cash market opens.
References
Financial markets
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