Circuit limit
Market basicsAlso called: Upper circuit
A regulatory cap on how far a stock or index may move in a single session.
In plain terms
A stock stuck at its lower circuit has no buyers at all — your sell order simply queues.
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Glossary
Every term is defined twice: once the way a filing would put it, and once the way somebody would explain it to you across a table. The second one is usually the one that sticks.
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Price band
Trading & ordersAlso called: Circuit limit
The maximum a security may move in a session before trading stops in that direction.
In plain terms
At the lower circuit there are sellers and no buyers, so a stop-loss simply cannot fill.
Liquidity risk
Trading & ordersThe risk that a holding cannot be sold at anything close to its quoted price because too little of it is being traded.
In plain terms
A quoted price with a handful of daily trades behind it is not a price you can transact at in size. Combine that with tight circuit limits and a bad announcement leaves you locked in for consecutive sessions.