Basic Financial Terms: What is the Upper and Lower Circuit in Share Market?

Financial Terms: You must have heard that when there is a downturn in the market, a stock or exchange circuit is decided. One is the lower circuit and the other is the upper circuit. This means the shares in that circuit cannot be traded. The value is decided by the exchange or based on the company’s downturn. 

Upper and Lower Circuit

If we talk about Nifty and Sensex, then in Nifty and Sensex, the circuit filters are 10%, 15% and 20%. It is a rule that if your circuit is on till 1 pm, then you cannot trade for an hour. If your circuit is on till 1.30 pm, then you cannot trade for half an hour. If it is on after 1.30 pm, then you can trade for 10%. The second rule is that if your circuit is on till 1 pm, then you cannot trade for 2 hours. This is about Nifty and Sensex. If your circuit is on till 1.30 pm, then you cannot trade for an hour. If it is on after 1.30 pm, then you cannot trade for an hour.