Limited up/down

Discussion in 'Index Futures' started by 0008, Nov 20, 2002.

  1. 0008


    When the limited up/down of a futures is triggered, is trading still going on but the price cannot move further? Is it only common in the commodities?
  2. Aaron


    Yes, the market is still open (unless there is a trading halt, like there could be in the stock indices).

    Trading can still happen at the limit price but usually the volume comes to a screeching halt. For example, if the fair price for a barrel of oil is $20.00, but the NYMEX market is limit up at $19.50, then you'll have lots of people bidding $19.50 but no one offering $19.50 and virtually no trading.

    By commodities do you mean physical commodities as opposed to financial futures? Financial futures have limits also. See the exchange websites for particulars.