Trading Curb

Sometimes things get wacky and you just have to say "Whoa...let's take a minute to think this over." Like...someone bumps into you at a bar. You're about to break a bottle and stab the guy in the neck with the jagged glass. But then...something inside you tells you to chill out for a minute, take a deep breath, and count to ten. And maybe look into anger management classes.

Trading curbs provide the same function on financial markets. They act as circuit breakers when the market either rises too quickly or falls too sharply. If the market moves more than a certain amount in a session, the trading curbs will turn on. Trading then halts for a short period of time, giving traders a chance to breathe and count to ten.