The following is taken directly from the NYSE Euronext site which you can visit here
NYSE Circuit Breakers In response to the market breaks in October 1987 and October 1989 the New York Stock Exchange instituted circuit breakers to reduce volatility and promote investor confidence. By implementing a pause in trading, investors are given time to assimilate incoming information and the ability to make informed choices during periods of high market volatility.
I love the phrase "promote investor confidence". I have a few ideas for promoting investor confidence but unfortunately I am not in charge. Lucky for soooo many out there for sure. That said here is a summary of the circuit breakers as of the Q2 2010 under rule 80B of the NYSE.
In the event of a 1010 point (10%) decline in the Dow;
Before 2:00 Dow is halted for 1 hour
Between 2-2:30 Dow is halted for 1/2 hour
After 2:30 no halt.
In the event of a 2010 point (20%) decline in the Dow;
Before 1:00 Dow is halted for 2 hours
Between 1-2:00 Dow is halted for 1 hour
After 2:00 Dow is closed for the day
In the event of a 3200 point (30%) decline in the Dow;
Regardless of the time the market closes for the day.
all times provided are EST.
I provide this information as a quick and easy reference point so that in the future one is not left scrambling madly to figure out when they're gonna shut down the markets because it is tanking.
quick sidenote: this European bailout has given rise to some calling it 'Le TARP' which I think is a complete misnomer. If you're gonna call it something, call it what it is, "Die Geld von Deutschen und geben die Griechen", also known as taking money from Germans and giving it to Greeks. Just like here take from taxpayers and give to banks. Oh yeah, and stuff Fannie and Freddie with all the bad paper, right Mr. Kanjorski?
Good speculating to you all and please remember to never forget that "an investor is a speculator who made a mistake and will not admit it".
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