Each stock has a certain limit upto which it can move, for a given day. This is called circuit filter. For example Amaraja Batteries has a circuit of 20%…meaning it can move up or down maximum of 20% on given day. When it hits +20% it called upper circuit freeze and when it hits -20% it is called lower circuit freeze.
Note : there is no circuit filter for derivative stock.
So when a stock hits upper circuit, it means there is strong buying and it cannot move up any further for the day.
Thanks Karthik, So lets lest im buying stock abc at 1.75 rs and its upper circuit is 2 rs. so If I have purchased 1000 qty at rs 1.75 and it hits upper circuit, does my profit get realized?
No, unless you sell the stock it is unrealized profit. To realize the profit you will have to sell the stock.
You need to wait until the stock is released from the circuit, the next day. It is possible that in the opening few minutes itself it will hit the circuit again. This can happen for few more days, in such very illiquid stocks.
The shares will be lying in your demat account, until you find a chance to sell those off.
Is it good to buy upper circuit share @der uc rate for short term or mid term?
Can u plz explain y yrs or no
Hello Karthik… I’m new to share market. By the way, what is mean by realised profit/loss and u realised profit/loss
How are circuit filters decided? What is the source of circuit filter?
What happens if i buy the stock in MIS and upper circuit is reached?Whether the position will be automatically squared off or it will be c/f next trading day?
This article will explain everything https://support.zerodha.com/category/trading-and-markets/margin-leverage-and-product-and-order-types/articles/circuit-limit-hit-intraday-product-type
Thank you.Got my answer
in the case of short delivery auction ;
do the client get the proof i.e. at what actual price the auction settlement happened
how can the client verify his auction trade ?
HI, once the upper band hit. do exchanges allow to shorting after release? in the same lower band hit, do exchanges allow to go long after release?
Yes, Once the circuit is released, you can take whatever type of position you want to take.
if again again upper band hits ,then what will happen ?
If circuits aren’t released then your Short position will result in Short Delivery, as you have Shorted stock that isn’t in your Demat.
If you are long, the stock you have bought will be credited to your Demat account.
Hi… Whats its the possibility of increase trend for the upper circuit stocks, very next day
Thanks to offer such helpful post, keep sharing more knowledgeable content.