For example,can a stock trading at ,be wiped out and almost become a penny stock in a day?i have seen stocks rising 100% but falling i am not sure.
Back in India i think we have a 10% regulation,to avoid scams or shortselling i am not sure though,if there are any indian traders please tell me the details about this too.
Oh i think even in India they have caps for the market,not for individuals stocks.
all of them are good answers, i mean they satisfy my question.except for the india part.tough to choose the best answer.
Thank you.
as a true investor let the market decide the best answer
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7 Comments on “How much can a stock fall in a day?”
TJ 14th March 2010
Stocks can theoretically drop 100% (to zero) in a day. It doesn’t happen frequently.
Back in late 2004, SGU dropped about 80% in one day when it gave reasons to suspect its viability.
http://finance.yahoo.com/q/bc?s=SGU&t=5y
That is probably the worst 1-day drop I can recall.
It is not unusual, however, for stocks to drop 30-50% in a day. Speculative biotech stocks, with no product in market and which trade on the basis of pipeline only can and do drop like that if they announce bad results in clinical trials (which they do, too frequently).
Yada Yada Yada 14th March 2010
To zero, I believe. Different than the market. The market’s have chokes in them to prevent complete collapses, but I don’t recall seeing restrictions on individual stocks.
Practically Suzy 14th March 2010
yes, you can loose all your money in a day. Many people lost a fortune when the tech stocks crashed in 2001.
cab veteran 14th March 2010
A stock can be worthless in one day, where as the entire USA stock market has built in downward limits after falling so many points, something like 500 points, so we don’t have another year like 1929.
Screaming Eagle 14th March 2010
Yes, a stock can fall to Zero in a day, but no lower.
Short selling does not have a limit, they lose when the stock goes up, and there is no limit on how high a stock can go in a day.
muncie birder 14th March 2010
In theory a stock can fall to zero in a single day, but in practice that seldom happens, if ever. There is always someone out there willing to speculate that it might be worth something and be willing to back up that speculation by purchasing it.
On Oct 19, 1987 Microsoft dropped from 64.25 to 45.00.
GE dropped from 49.75 to 38.75
So very steep drops in stock prices are not beyond the realm of possibility.
tjc 14th March 2010
It wasn’t in one day, but ENRON became worthless in a very short time, both the common and preferred stock issues.