Price limit

{{short description|Established amount of increase or decrease of a price in a given trading day}}

A price limit is an established amount in which a price may increase or decrease in any single trading day from the previous day's settlement price.

In financial and commodity markets, prices are only permitted to rise or fall by a certain number of ticks (or by a certain percentage) per trading session.{{Cite web|title=Daily Price Limits|url=http://www.oxfordfutures.com/futures-education/price-limits.htm|accessdate=February 24, 2012}} Similarly, index futures are often permitted to move a certain amount before the cash market opens.{{Citation | title = Stock Index Price Limits | url=http://www.cmegroup.com/trading/equity-index/files/PriceLimitGuide.pdf | accessdate = January 3, 2012 }}