What are circuit breakers and trading halts?
Circuit breakers are thresholds where market-wide trading halts are instituted. No security transactions (e.g. pending trades) will be executed during trading halts. The below trading halts will be implemented by markets if a single day decline in the S&P 500 Index exceeds the below levels:
- Level 1 – Decline of 7% will result in a 15-minute trading halt
- Level 2 – Decline of 13% will result in a second 15-minute trading halt
- Level 3 – Decline of 20% will result in the market closing for the remainder of the day
Additionally, volatility in a specific security (e.g. stock) may result in a trading halt for that specific security. These can be implemented by trading exchanges regardless of whether a market-wide halt is instituted.
Note that the price of securities can fluctuate between the start of a trading halt and the execution of a security after the trading halt. Cryptocurrency transactions are not impacted by stock market circuit breakers and trading halts.
What happens to unexecuted trades during trading halts?
Full share market orders that are unexecuted at the time of a market halt will be executed once trading commences.
Stock bit trades are executed once a day towards the end of the day’s trading hours. If a 15 minute trading halt occurs towards the end of the day’s trading hours or the market closes for the remainder of the day, stock bit executions may be delayed until the next trading day
Note that the price of securities can fluctuate between the start of a trading halt and the execution of a security after the trading halt.
Can I place a trade during trading halts?
You will be unable to submit trades during market-wide halts. Once trading commences, you should be able to submit new trades.
If trading in an individual security is halted but there is no market-wide halt, you may be able to submit trades but the trades will not be immediately executed. Submitted trades will be executed once trading commences.
Note that the price of securities can fluctuate between the start of a trading halt and the execution of a stock post-halt.
Cryptocurrency transactions are not impacted by stock market circuit breakers and trading halts.