How is there a circuit limit on FO stocks? but it only lasts for 20mins. I don’t understand the circuit limit concept on FO stocks can some one please help me or point me to the right direction to understand the rules

Hey @Keshav1,

FO stocks carry a circuit limit of 10% and then increments of 5% each along with market halts varying between 15 minutes to the remainder of the day. These trading halts are added to ensure that panic-based decisions are reduced due to sudden stock price movements.

If I have a position how am I suppose to know if the trading halt is going to last for the whole day or for just another 15 mins. This is very confusing !

Individual stocks that are in the FO universe carry a 15 min cool-off all throughout the day for every 5% movement beyond the first 10% circuit limits.

If the broad market index(Nifty 50 or Sensex 30) hits a circuit, the below-mentioned cool-off criteria are followed.

So FO stocks can move by more than 20% in a day but every 5% move will cause a circuit limit for 15mins. Assuming the index is stable.

Is this the correct understanding.

Thanks

Yes!