Trading halts temporarily pause trading in a specific stock or the entire market.
Why stocks get halted
News pending: A company is about to release significant news
Volatility: Extreme price movements trigger automatic halts
Regulatory: SEC or exchange halts trading for investigation
What happens during a halt
- You cannot buy or sell the halted stock
- Pending orders remain in queue (unless canceled)
- When trading resumes, orders are processed
Types of halts
Single-stock halts:
- Limit Up-Limit Down (LULD): Triggers when a stock moves too quickly
- News pending: Company has material news to release
Market-wide halts:
Circuit breakers pause the entire market based on S&P 500 declines:
| Level | Decline | Action |
|---|---|---|
| Level 1 | 7% | 15-minute halt |
| Level 2 | 13% | 15-minute halt |
| Level 3 | 20% | Market closed for day |