What Are 'Circuit Breakers'?

Circuit breakers are measures approved by the SEC to curb panic-selling on U.S. stock exchanges and excessive volatility in individual securities. ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌ ‌

Term of the Day | Words to Know Circuit Breaker Circuit breakers are measures approved by the Securities and Exchange Commission (SEC) to curb panic-selling on U.S. stock exchanges. They apply both to broad market indices such as the S&P 500 as well as to individual securities. Circuit breakers function by temporarily halting trading when prices hit predefined levels, such as a 13% intraday drop for the S&P 500. Read More » Related to "Circuit Breaker" Financial Regulators: Who They Are and What They Do Find out how these financial regulators govern the financial markets. Read More » The SEC: A Brief History Of Regulation The SEC has continued to make the market a safer place by learning from and adapting to new scandals and crises. Read More » The Cost of Free Markets Some argue that when the free market fails to protect consumers, government regulation is required. Read More » SPONSORED BY INVESCO The Complete Guide to ETFs ETFs are becoming increasingly popular and soaring to new heights among investors. Invesco's insights can help you determine if these investment vehicles are right for you. Learn More » Related Definitions Securities and Exchange Commission (SEC) The Securities and Exchange Commission (SEC) is a U.S. government agency created by Congress to regulate the securities markets and protect investors. Read More » Trading Halt A trading halt is a temporary suspension in the trading of a particular security on one or more exchanges. Read More » Black Monday Black Monday, Oct. 19, 1987, was a day when the Dow Jones Industrial Average fell by 22% and marked the start of a global stock market decline. Read More » Flash Crash A flash crash is an event in electronic markets wherein the withdrawal of stock orders rapidly amplifies price declines. Read More » CONNECT WITH INVESTOPEDIA Email sent to: mondemand.forex@blogger.com To update your newsletter preferences or unsubscribe, click here. 114 West 41st St, floor 8 New York NY 10036 © 2020, Investopedia, LLC, All Rights Reserved | Privacy Policy