Gap Up

In stock market terms, a gap up is a rise in the market price of a security which occurs after an exchange closes at the end of a trading day, and before the exchange opens for the next trading day. A gap up is caused by an increase in buy orders for a security over the course of the closing hours of the exchange on which the security is listed.

Example: The closing price of a stock at the end of a trading day is 1.50 Swiss francs. At the start of the next trading day, the opening price of the same stock is 1.60 francs. The “gap up” in this case would be 10 centimes per share.

See also: Gap down

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Daniel Dreier is editor and personal finance expert at moneyland.ch.

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