Blackout

A blackout is a self-imposed rule: for these few days, in this stock, don’t start anything new.

The usual reason is a scheduled announcement. A company’s earnings report lands while the market is closed, so the price can jump overnight past any stop you have — the one risk a stop genuinely cannot cover. Sitting out the two or three days around the report trades a few opportunities for removing that jump from your book.

Say you hold nothing in XYZ, which reports on Wednesday evening, and your rule signals a buy on Monday. Under a two-day blackout nothing is bought on Monday, Tuesday or Wednesday. On Thursday, with the results public, XYZ is ordinary again.

A blackout stops entries, not exits. Anything you already hold can still be sold — which matters most on exactly those days.

The phrase is borrowed from company insiders, who are barred by law from trading their own employer’s shares in the weeks before results. This is the same shape of rule, chosen rather than imposed.