Feeds

Software bug flattens NYSE trader

Plunged into $US440 MILLION loss

High performance access to file storage

An algorithmic trading software bug is being blamed for a day of wild swings at the New York Stock Exchange – and has resulted in the trader placing the dodgy orders reporting a $US440 million pre-tax loss.

What’s been called a “mini flash crash” by Forbes saw 150 NYSE-traded stocks, from General Electric down to minnows, subject to wild swings before things were brought under control. Knight Capital, the firm fingered for the glitch, responded by telling its customers to use other traders – and has since reported the loss as a result of the Wednesday, August 1 software problem.

With a huge chunk of its value wiped out by the glitch, Forbes now says the cost of the bug is roughly equivalent to Knight Capital’s entire market capitalization.

Reuters states that the only comment to come from the company is a terse statement that “a technology issue occurred in Knight's market-making unit related to the routing of shares of approximately 150 stocks to the NYSE”.

The Reuters report suggests that timing may have been the problem: the orders may have been intended to be filled during the trading day, but instead were filed in the opening minutes of trading.

The latest trading disaster follows the 2010 "Flash Crash", in which a single bad order triggered a thankfully-temporary trillion-dollar market crash; and the embarrassing crashes that plagued the Facebook IPO, preventing the stock from plunging anywhere as quickly as it probably should have on listing. ®

High performance access to file storage

More from The Register

next story
Dropbox defends fantastically badly timed Condoleezza Rice appointment
'Nothing is going to change with Dr. Rice's appointment,' file sharer promises
Audio fans, prepare yourself for the Second Coming ... of Blu-ray
High Fidelity Pure Audio – is this what your ears have been waiting for?
Did a date calculation bug just cost hard-up Co-op Bank £110m?
And just when Brit banking org needs £400m to stay afloat
MtGox chief Karpelès refuses to come to US for g-men's grilling
Bitcoin baron says he needs another lawyer for FinCEN chat
Zucker punched: Google gobbles Facebook-wooed Titan Aerospace
Up, up and away in my beautiful balloon flying broadband-bot
Apple DOMINATES the Valley, rakes in more profit than Google, HP, Intel, Cisco COMBINED
Cook & Co. also pay more taxes than those four worthies PLUS eBay and Oracle
It may be ILLEGAL to run Heartbleed health checks – IT lawyer
Do the right thing, earn up to 10 years in clink
prev story

Whitepapers

Top three mobile application threats
Learn about three of the top mobile application security threats facing businesses today and recommendations on how to mitigate the risk.
Combat fraud and increase customer satisfaction
Based on their experience using HP ArcSight Enterprise Security Manager for IT security operations, Finansbank moved to HP ArcSight ESM for fraud management.
The benefits of software based PBX
Why you should break free from your proprietary PBX and how to leverage your existing server hardware.
Five 3D headsets to be won!
We were so impressed by the Durovis Dive headset we’ve asked the company to give some away to Reg readers.
SANS - Survey on application security programs
In this whitepaper learn about the state of application security programs and practices of 488 surveyed respondents, and discover how mature and effective these programs are.