Held At The Opening

A situation in whicha security is restricted from trading when the stock exchangeopens for the day.Stock exchanges can halt trading on securities at any time, but tradingusually resumes in under an hour. If the halt occursbefore the beginning of a trading day, the stockis consideredheld at the opening. This kind of halt in trading is done to protect investors.

Taobiz explains Held At The Opening

There are three main reasons why astockisheld at the opening:

1. The company plans to release new information that could have a drastic impact on the stock's price. Time is given for participants to fully understand the new information and place buy and sell orders accordingly.

2. There is an imbalance of buy and sell orders.

3. The stock does not meet the listing requirements set by the regulatory body.

For example, a stock may be held at opening if there is a significant imbalance in buy and sell orders before the opening bell, the stock can be held at opening. This will give market specialists time to disseminate the information to investors and make a decision on a fair trading-price range.