Glossary
Limit up-limit down (LULD)
A US mechanism that pauses trading in a single stock when its price moves outside a percentage band around its recent average.
Limit up-limit down is the US rule set that stops a single stock or ETF from trading at prices far from where it traded a few minutes earlier. Every listed (NMS) stock gets a price band, recalculated continuously during regular hours; trades outside the band are not allowed, and if the price cannot return inside it quickly, trading pauses for five minutes. It exists to slow sudden, disorderly moves like the May 2010 flash crash.
How the bands are set
The reference price is the average price of eligible trades over the previous five minutes. The band width depends on the stock's tier and its previous close (rules as of 2026):
| Previous close | Tier 1 (S&P 500, Russell 1000, some ETPs) | Tier 2 (all other NMS stocks) |
|---|---|---|
| Above $3.00 | 5% | 10% |
| $0.75 to $3.00 | 20% | 20% |
| Below $0.75 | lesser of $0.15 or 75% | lesser of $0.15 or 75% |
In the last 25 minutes of trading (3:35 to 4:00 p.m. ET) the bands double for all Tier 1 stocks and for Tier 2 stocks at or below $3.00. Leveraged ETPs are always Tier 2.
What happens at the band
When the best bid or offer sits at a band, the stock enters a limit state for 15 seconds. If it does not clear, the listing exchange declares a five-minute trading pause, which can be extended, and then reopens with an auction. A pause in the final ten minutes is not reopened; the closing process runs instead. The plan does not apply in pre-market or after-hours sessions.