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LSDefine
Simple English definitions for legal terms
curb
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A quick definition of curb:
A curb is a temporary rule that stops people from buying or selling a certain thing, like a stock, when the price is changing too much. This is done to prevent big swings in the price and keep things more stable. Sometimes people use the word "curb" instead of "trading curb" to talk about this rule. Another similar rule is called a trading halt, which stops trading in a certain thing for a little while because of something important that's happening, like a big news announcement.
A more thorough explanation:
Definition: A temporary restriction on trading in a particular security to prevent sudden and significant price movements. This is also known as a trading curb.
Example: If a company announces unexpected negative news, such as a major product recall, the stock price may plummet rapidly. To prevent panic selling and further price drops, a trading curb may be implemented to temporarily halt trading or limit the amount of shares that can be traded.
This example illustrates how a curb can be used to prevent extreme price movements and maintain market stability.