Are you looking to know about how to sell shares in lower circuit or how to exit from lower circuit stocks? If yes then you came to article.
In this article you will get to know about selling shares in lower circuit or exiting form lower circuit stocks.
LOWER CIRCUIT MEANING
In simple words lower circuit refers to a situation where stock exchange imposes some limit on a stock and in a single day how much stock price go down.
ABC share price is Rs 100/-. Its started decreasing on a particular day. On that day stock exchange imposes limit of 10% lower circuit. Because of this stock only decrease up to Rs 90 only. In this situation there are only seller of ABC shares only limited number buyers purchase this share.
SELLING SHARES IN LOWER CIRCUIT
Selling shares in lower circuit is very challenging because in lower circuit there are very limited number buyers who purchase the shares. Before selling we need to understand the market situation and what the reasons for the lower circuit.
To sell a share in lower circuit we need to place a limit order. In limit order allows to set a price of the share. Its allows us not to sell shares a below price.
We need to monitor the market very closely because it will provide good idea to adjust our selling price of the share. We need to consult our broker. They will provide help to sell the shares.
We need to be patient, need to avoid panic selling. By careful planning, right approach we can minimize the losses. We need to use stop loss orders. These all transaction will be done in share market.
For Example :
We want to sell share is lower circuit. First thing we need to place a sell order in Pre-Market with the following calculations.
Current Market Price of Share X 0.95 = Share Selling Price
(Note: Stock price movement is 0.05 paisa)
By this formula we can sell shares in lower circuit.
Dear reader in this article you get to know about how to sell shares/ stocks in lower circuit. You are requested to check out other articles in this website. If you have any query regarding this article kindly comment below.