A stock market mechanism that aims to maintain price continuity during highly volatile periods. It will help reduce or rein in volatility and prevent massive panic sell-offs. When circuit breaker is active, traders can have time to cool off, grasp the market events, and reconsider their trades in a better light. Circuit breaker halts trading or puts a price band/ market protection limit on every share trading on the exchange until volatility gets back to normal. In that sense, circuit breakers help stem market crashes before occurrence.
Circuit break is a type of market curbs.
