Manpasand Beverages hit the lower circuit at around 156INR today at opening bell as per the usual trend in last few trading sessions. But around 3PM why did it go up again? I had an opinion that circuited stocks are not allowed to trade in the day once circuits are hit.
It opened the day in LC, if its not allowed to trade, then how u expect it to come up? That means it will always hit LC until ZERO?
I think that rule is for stock which moves from normal trading to LC or UC within trading session
But even for those stocks I doubt, the rule seems wrong. As I have seen many stocks hitting UC and falling down. Or hitting LC then going up.
Noob here, but isn’t there some sort of circuit on the indices whereby trading is halted for sometime? I think the OP is under the impression that even individual stock circuits have a similar mechanism. AFAIK there are no stock circuits where trading will be halted. Please correct me if I’m wrong.
Yes i think stocks dont have it
I remember reading somewhere stocks also get trading suspended on hitting circuit, but definitely its not followed i am sure
may i read old info or wrongly thats why i also was confused
Be logical. If stocks don’t have circuits then any stock on a bad day can move to Zero.
It is like this. Whenever a stock hits the LC, it means no seller can offer shares at a lower rate than LC. However, offers can be made to sell it at a higher rate than LC. If the market absorbs the entire quantity at LC and still there are buyers in the market it tends to go up and the other offers are getting matched. That’s all. Similar is the case for UC where no buyer can quote a higher rate than UC.
Well, an unpopular stock can go to zero despite circuits. The pain just gets spread across many days. eg. Gitanjali, Vakrangee.
A fairly popular stock can recover intraday despite not having circuits. eg. PCJ.
Circuits are meant to curb panic and knee jerk reactions, theoretically speaking. Essentially to allow investors to sleep over any news etc. They aren’t meant to prevent stocks from falling, per se.
In reality, circuits lead to irrational behaviour either way, in my limited experience.
That’s true , in my experience too , even Nifty & Bank nifty indices have circuit limit , I traded commodities futures often hitting upper & lower circuits . Now a days circuit hitting phenomena are rare , happening only with few stocks
The funny bit is, Sebi wanted to curb volatility recently by putting stocks under ASM. Instead, investors in these stocks have been in for a rocket ride this week.
Who knows? Maybe these ASM stocks may be less volatile in future & Sebi actions may be justified.
But again, at some point these have to be reviewed and brought out of ASM. What then…?
Hi. So would the circuits on the indices lead to trading being halted for a few hours? & what about the Commodities & FnO markets? Thanks.
Buddy you haven’t read my question properly first hand, you haven’t checked the last trading session chart of Manpasand and keep answering thinking that you might be correct. Let somebody who has knowledge on it answer.
What about the last trading session chart?
It was in LC and came out of LC at 3 PM?
Many stocks do it for the same reason I mentioned in my answer
Circuit limit on indices/ FNO / Commodity , for a cooling period of around 20 minutes , if it does hit circuits again trading will be halted for the day . In case of Commodity , since the commodities are future contracts , short sellers / buyers has to cover their position , so there will be a chance to exit positions , but in case of stocks ( cash trade ) there is no guaranty / highly risky .
Hey, thanks for taking the time. Much appreciated.
Circuit limit doesn’t mean that , one cannot trade , one can trade in between the circuit limit , but it should be " EQ / FNO series " concept of circuit limt is rightly explained by @kidrow.
if you follow TA its easy to understand ( note- i am not recommending, its my observations)
1 daily charts are indicating some one is buying
2 NSE Security-wise Delivery Position shows % of Deliverable Quantity to Traded Quantity 47.85 % ,so some one is buying .
3. Manpasand business is not a bad business , problem is its Auditors PWC ( PWC it self in a legal problem ) ( Capital-market regulator Sebi’s ban on Price Waterhouse from auditing listed companies in India for two years for its role in the Satyam Computer Services scam )