The SEC on Thursday said it would extend the limit-up, limit-down stock-trading pilot, until April 21, 2017.
The pilot, originally planned to last for one year, had been scheduled to end Thursday.
The Securities and Exchange Commission said in a news release that it wants participants to conduct further analysis regarding the pilot’s operation, including during Aug. 24, 2015, when huge volatility spikes hit exchange-traded products and corporate stocks.
The SEC asked exchange participants in the pilot to submit further recommendations on the trading of exchange-traded products, among other subjects.
The SEC pilot, approved in 2012, prevents trades in listed equity securities when an individual stock price moves beyond a specified price band. That band would be above and below the average price of the stock over a five-minute trading period. If a stock price is outside the price bands, it has 15 seconds to move back within the limit range or trading on that stock will be halted for five minutes.
The SEC said in a research paper issued Dec. 29 that it would look into issues related to the Aug. 24 trading events, including the impact of current SEC regulations that prevent naked short selling and impose short sale-related circuit breakers; the reopening process following limit-up/limit-down halts; and how marketwide circuit breakers were applied in the period after the opening of regular trading hours on Aug. 24.
