Legal Definitions - suspended trading

Definition: Suspended trading refers to the temporary halt of trading in a particular stock or security. This can occur for a variety of reasons, such as a significant news announcement or a technical glitch in the trading system. During a trading suspension, investors are unable to buy or sell the affected security.

Example: If a company announces that it has discovered accounting irregularities, trading in its stock may be suspended while the situation is investigated. This gives investors time to assess the situation and make informed decisions about whether to buy, sell, or hold the stock.

Explanation: When trading is suspended, it means that the market is temporarily closed for a particular security. This can happen for a variety of reasons, but it is usually done to protect investors from making uninformed decisions based on incomplete or inaccurate information. By halting trading, investors have time to gather more information and make informed decisions about how to proceed.