How does NASDAQ handle market volatility?

NASDAQ employs a range of mechanisms to handle market volatility, ensuring that trading remains orderly and fair during periods of heightened uncertainty. One key approach is the implementation of circuit breakers, which are temporary trading halts triggered by sharp market declines. These circuit breakers serve to provide investors a moment to assess market conditions and to prevent panic selling, which can exacerbate volatility. Additionally, NASDAQ monitors real-time data on trading activity and market indicators. They have systems in place that detect unusual trading patterns, allowing for swift responses to potential issues. This includes market surveillance aimed at identifying manipulative or abusive practices that could destabilize the market. Another aspect that NASDAQ incorporates is the use of price limits for individual stocks. When a stock's price moves significantly in a short period, these price limits can pause trading on that particular stock, further allowing market participants to digest information and make informed decisions rather than react impulsively to sudden price swings. Furthermore, NASDAQ provides tools and resources to investors and market participants that promote transparency and education about market fluctuations. By enhancing awareness of market dynamics, NASDAQ encourages informed trading practices. Investors looking for the most current information about NASDAQ's procedures or tools in handling volatility may find detailed resources on the official NASDAQ website. This site can also provide information about relevant policies, trading rules, and enhancements designed to address market conditions.