AMC cinema line in the U. S. stock market trading triggered circuit breaker, what is circuit breaker, what are the rules of U. S. stock circuit breaker?

Circuit breaker mechanism (Circuit Breaker), also known as automatic suspension mechanism, refers to the suspension of trading measures taken by the exchange to control risk when the volatility of the stock index reaches the prescribed circuit break point.

The birth of the current circuit breaker mechanism in the United States can be traced back to the global stock market crash on October 19, 1987, also known as "Black Monday". The Dow Jones Index fell 508 points, or about 22.6%, in a single day.

(1) market circuit breaker: us stocks implement a three-stage circuit breaker mechanism. For example, when the S & P 500 index falls by 5%, it will be suspended for 15 minutes; when the stock index falls by 10%, it will be suspended for 1 hour; when the stock index plunges 20%, the stock market will be closed for one day.

Since 2010, U. S. stocks have implemented a circuit breaker mechanism.

(2) individual stock circuit breakers: according to the latest regulations of the Securities and Exchange Commission (SEC), the circuit breaker mechanism not only aims at the circuit breaker mechanism of the stock market, but also has a mechanism to limit the upper and lower limits of price fluctuations. If the trading price of an individual stock rises or falls more than that within 5 minutes, trading should be suspended (depending on the type of stock, the price fluctuation can be 5%, 10%, or 20%). If the trading price of the stock does not return to the prescribed "price range" within 15 seconds, the stock will be suspended for 5 minutes (the maximum suspension time is 10 minutes).

For stocks in the S & P and Russell 1000 indices and 430 exchange-traded products trading at more than $3, the "price range" set by the SEC is up or down 5 per cent, while the illiquid "price range" of other illiquid stocks trading below $3 is relaxed to 10 per cent.

With the help of the circuit breaker mechanism, the US Securities Regulatory Commission can effectively control the abnormal rise and fall of the market and individual stocks, and play a stable role in the trend of the market and individual stocks.