Suppose a stock has an upper circuit limit of 20%. The stock price is INR 100 currently. So, the upper price limit is INR 120. If I were to buy the stock @ INR 110, and the stock reaches INR 120 after that, will I be able to sell the stock @ Upper circuit price = INR 120 ? I am asking since Market Depth @ Upper circuit shows ‘Zero’ Sell quantity.
You can sell the stock after it hits Upper Circuit. You see Zero sellers because no one is willing to sell the stock while there are potential buyers, this imbalance between the two causes stock to hit circuit.
While it is easy to sell a stock when it hits Upper Circuit, it isn’t when stock is hitting Lower Circuit as at that time there are sellers but no willing buyers and stock can continue hitting Lower Circuit for day’s. These type of stocks are illiquid and driven by operators to trap traders, you should stay away from such stocks.
So, if no one is willing to sell the stock, and after hitting circuit, the stock remains closed for trading till end of day, do I have to sell it the next trading day ?
You will find buyers for such stock any time but you should stay away from such stocks, I’ve already explained the reason above.
Ok, so if I were to use MIS (Margin Intraday Square-off) Order for Short Selling the stock, since that is for Intraday purpose only, and it has high volume, will I still not be able to Square-off the Trade and get trapped ?
If you trade only in high volume stocks (ie. Nifty 50 stocks) chances of you getting trapped are very low to none. In once in a lifetime event if you are trapped what will happen is explained here.
Thank you for your clarification and support !
pls cn u clarify once again
I hav bought a stock @ 100 n its UC is 105 n currently its in uppr circuit, will i be able to sell it ? If ys, hw cn i sell whn trading in tht stock is halted ? N if m able to sell thn it shld mean trading still going on thn why its mentioned everywhr tht trading halted fr the day or fr 15 mins or 30 mins ?
Stocks hit Upper or Lower Circuit mostly due to imbalance in Demand and Supply, as in Upper Circuit there are buyers and very few sellers and total opposite in Lower Circuit. If you want to sell you can try placing a sell order, it should get executed.
This is true for Indexes like Nifty and Sensex, when Index hits Circuit Limits trading is halted for a certain period of time to cool off the sentiment before resuming again.
Thank you fr the clarification … will try this wth less qty
Assuming I purchase a stock CNC delivery and it hits upper circuit in 2 days will i be able to sell the stock when it hits upper circuit?
Yes, you can sell a stock which has hit Upper Circuit, in this scenario there are buyers but very less sellers.
Assuming I purchase a stock today CNC Delivery. And it hits upper circuit can i sell the stock the same day I purchased it?