This article re–examines the extent, if any, of the negative impacts of price limits. I provide fresh evidence supporting, only partially, the criticisms against the efficacy of such price limits. A negative impact of price limits when valid for one group of stocks or direction of price move, may not hold for another group of stocks or direction of price move. The article also presents a realistic estimate of the potential trading profits that may be made by using price limit hits as a trade signal.
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