The circuit is a upper and lower limit beyond which the trading is not allowed. Different stocks have different circuit limits. Usually they are 5%, 10% and 20%.
For example, let’s say closing price of X stock yesterday was 100 Rs. The applicable circuit limit for X is 5%. In this circumstances, the price of X can’t go above 105 (5% above previous close) and below 95 (5% below previous close).
Please not that this limit is different for different stocks. For some stocks, the limit may be 5%, while for some stocks, it may be 10% or 20% also. For a newly listed company also, there is a circuit limit of 20% from its issue price.
There are two types of circuits:
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Buyer Circuit or Upper Circuits ,and
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Seller circuit or lower circuit.
The purpose of circuit is to regulate the price and prevent any malpractise by traders or brokers/oprators.
Hi
Is it that some stocks do not have any circuit limits? For example Orchid Chemicals.
http://www.bseindia.com/stockreach/stockreach.htm?scripcd=524372
What is the criteria of not having circuit limit for these?
All FnO scrips do not have nay circuit limits as per the guidelines…