Stock Price Formulation

Why are special quotes sometimes not renewed to their daily limit prices?

Update : May 12, 2011

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Answer:

Special quotes cannot be renewed beyond the price of the order which originally prompted the SQ.

Offer Price Bid Let's assume that a buy order for 1,000 shares is placed during zaraba trading, at a limit price of 995 yen, 45 yen higher than the last executed price of 950 yen. As there is no matching order it cannot be executed.

M.O.
100 1,010  

995 1,000

980

965

950

Offer Price Bid So a bid SQ of 965 yen is indicated, to alert investors to the existence of an order above the most recently executed price.

M.O.
100 1,010  

995 1,000

980

965 S

950

Offer Price Bid If a matching order is not received after 3 minutes, the SQ is renewed to 980yen, and if necessary to 995yen after a further 3 minutes. The SQ will remain at this price until a sell order is received. The SQ cannot be raised to a level beyond the original order (995yen).

M.O.
100 1,010  

995 S 1,000

980

965

950

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