Computer Problem Caused Price Errors on NASDAQ 160
buckthorn writes "An article running on Yahoo News states: 'A computer problem at an unidentified stock trader caused erroneous, exaggerated prices -- some as high as $950 per share -- to be posted to the Nasdaq Stock Market Friday morning for 1,680 different stocks, a spokeswoman for the Nasdaq said.'"
Mr President, Dr. Evil is on the line... (Score:5, Funny)
Good afternoon gentlemen. As you are all no doubt aware, I have perfected a method of manipulating the various stock exchanges throughout the world. You received proof of this this morning, as relatively worthless Nasdaq stocks such as Maxco, Inc. and J.W. Mays Inc. traded briefly at hundreds of times their real value. I believe my latest caper, which I've puckishly dubbed 'Operation Stocking-Stuffer', is certainly worthy of your attention...
You see, gentleman, when 'Operation Stocking-Stuffer' is deployed in earnest, all stock exchanges will be laid waste...all trade will effectively cease, and global civilization itself will crumble...that is...unless you pay me...
Gentleman, you have my demands...peace out.
Dr. Evil gets frist post! (Score:3, Funny)
Re:Mr President, Dr. Evil is on the line... (Score:5, Funny)
(a huge server farm where the racks are shaking violently and making strange noises)
Engineer1: I need a young priest and an old priest!
Engineer2: The power of Christ compels you!
"The power of Jesus compels you"?!! (Score:2)
screaming into cell phone... (Score:5, Funny)
Re:screaming into cell phone... (Score:2, Funny)
Re:screaming into cell phone... (Score:2, Funny)
Re:screaming into cell phone... (Score:1)
Re:screaming into cell phone... (Score:2)
Re:screaming into cell phone... (Score:2, Funny)
Thanks for the tip! I made money with Sun stock!!
Friday 13th (Score:2, Insightful)
Re:Friday 13th or why they have rules (Score:3, Informative)
It's not just there to allow for slow paper to move, but there to allow rollbacks.
Take those transactions back! (Score:2, Funny)
Not this again (Score:5, Funny)
Re:Not this again (Score:1, Funny)
Trading Technologies (Score:3, Funny)
Praetorians? (Score:2)
Re:Praetorians? (Score:1)
Re:Praetorians? (Score:4, Funny)
Wow, that was close. (Score:3, Funny)
Re:Wow, that was close. (Score:2)
Re:83k usd? (Score:1, Informative)
The introduction of the BRK-B shares smudges the story a bit, though. He does recognize that $83k isn't the most convenient chunk of change to toss around for most people.
Re:83k usd? (Score:2)
There's a good Wikipedia article on Berkshire Hathaway. [wikipedia.org] Turns out they own Dairy Queen and GEICO, a
Re:83k usd? (Score:2)
Oh for those options....
Re:83k usd? (Score:2)
Re:83k usd? (Score:2)
Re:83k usd? (Score:2)
You can't have capital gains without that little number at some point going from a lower value to a higher value. That little number represents the stock price. Stop trying to win this one, go pick a battle that you're not certain to lose.
Re:83k usd? (Score:2)
I'M RICH BIATCH!! (Score:2, Funny)
W00t!!
Re:I'M RICH BIATCH!! (Score:2)
Yeah! Now you can go to the movies!!
Price in blurb says nothing. (Score:2, Insightful)
Re:Price in blurb says nothing. (Score:1)
Re:Price in blurb says nothing. (Score:1)
Re:Price in blurb says nothing. (Score:1)
Re:Price in blurb says nothing. (Score:1)
"For example, shares of Maxco Inc., a metal heat-treating company that normally trades between $3 and $4 per share, was briefly quoted at $951.47 Friday morning. It later traded at $4.10 per share."
While not unheard of on the Nasdaq, I'm pretty sure 950 dollars is unheard of from this company.
Re:Price in blurb says nothing. (Score:2)
Damn man, you've been out of it for a while.
Re:Price in blurb says nothing. (Score:1)
"COMPUTER" error (Score:5, Insightful)
It was either a programming error (human) or an operator error (human) or some other cause. OK, clearly hardware faults can cause data corruption, but this is really pretty rare and it's hard to believe that a hardware fault could cause such a widespread fault.
Re:"COMPUTER" error (Score:3, Funny)
Another good reason to eliminate The Human Factor. Let the Robot Age begin!
Re:"COMPUTER" error (Score:5, Insightful)
I love this quote :
At the source of every error which is blamed on the computer you will find at least two human errors, including the error of blaming it on the computer.
Re:"COMPUTER" error (Score:1)
Yes, I am sysadmin guy, why do you ask?
Re:"COMPUTER" error (Score:1)
You musn't forget Dr. Alfred Lanning's "ghost code"...
Re:"COMPUTER" error (Score:1, Interesting)
OK, clearly hardware faults can cause data corruption
In the case of hardware failure, it would be the person implementing the systems who made the error, for not adequately accounting for this type of problem (e.g. RAID, clustering, etc).
Re:"COMPUTER" error (Score:2)
It'd also be pretty rare for a fault like this causing robots to suddenly self-replicate and rebel.
Re:"COMPUTER" error (Score:2)
SCOX? (Score:3, Funny)
Talking of bugs... (Score:1)
Re:Talking of bugs... (Score:1)
It is possible (Score:3, Interesting)
Re:It is possible (Score:2)
Local Police are reporting tonight on the death of the entire IT staff at a local internet shopping centre. The victims were beaten senseless with several tennis rackets and golf clubs shortly before being run over by a Corvette, three Porches, and a BMW 5si.
Police refuse to confirm or deny the use of expense reports in the binding of the victims, although a couple bloodied credit cards were found at the scene next to half a dozen Venti Latte
Re:It is possible (Score:3, Interesting)
Of course, how practical that is does depend on how many different categories of products you have to deal with. You can take an initial crack at "reasonable" via an arithmetic mean or something, but "rea
Re:It is possible (Score:2, Interesting)
A what?
Re:It is possible (Score:2)
"A what?"
That's where peopel go to buy internets!
Re:It is possible (Score:2)
Re:It is possible (Score:2)
I'm rich! (Score:2, Funny)
I wont let them. They can't take it back.... right?
What the hell is banging on my door? They are insi#%*#&)^*!&$NO CARRIER
ObOfficespace quote (Score:5, Funny)
Re:ObOfficespace quote (Score:3, Funny)
Function: transitive verb
: to transfer (money or instruments deriving from illegal activity) so as to conceal the true nature and source
Re:ObOfficespace quote (Score:2)
From those who lost their Hawaiian shirt today... (Score:1)
Re:ObOfficespace quote (Score:2)
Re:ObOfficespace quote (Score:2)
Profit? (Score:3, Informative)
Re:Profit? (Score:2)
Been going on for over a year now... (Score:4, Funny)
Longer than a year... (Score:2)
I demand a refund.
Stupid computers
Re:Been going on for over a year now... (Score:2)
http://www.google.com/search?oi=stock&q=stocks:SC
Damnit! (Score:5, Funny)
Re:Damnit! (Score:2)
I know you were probably joking, but anyone who actually sold their shares at those high prices will have to give back the money (actually, they never got the money in the first place, as settlement is 3 days after the actual trade).
NASDAQ has a policy on "Clearly Erroneous Transactions".
Good thing I sold Sony ADR (Score:1)
Oh, wait, I would have made even more
Darn.
In other news (Score:2, Funny)
its a problem (Score:3, Interesting)
one coding error can suspend the trading of a major stock, or worse as in this case move the price miles from where it should be.
theoretically the exchanges shouldn't allow you to do this. some work by suspending automatically and restarting with an auction, some work by suspending it. locking you out and fining you loads of cash. this costs you big as nobody else can trade that stock through you for a while. thats really expensive - the lost business.
when your taking in client orders and trading them automatically and you recieve orders via say FIX.
yes you do lots of checks with vol, movement on the day, movement since the close, momentum etc.
but how well do these checks work when your market data feed has gone down (or worse gone wrong) or even gone down, but the heartbeat process is still pinging so you think you have a good price?
but i guess sometimes we get it wrong just like anywhere else. this is just a rather high profile and embarrassing example.
still they won't do it again (for a while)
Re:its a problem (Score:1)
We haven't had anything go too badly wrong. Yet.
Re:its a problem (Score:1)
I get shivers because a few mistakes we caught in beta like certain currencies where the buy and sell have been reversed, etc.
Either way, the whole point with big money systems is to have everything worked out in PRE-PROD and tested and stream live.
Looks like somebody missed a step somewhere, but rolled it back quick enough. Just wish I had my hand on the sell button soon enough
Re:its a problem (Score:1, Informative)
The quality of trading systems varies tremendously. I've seen some that can easily handle many hundreds of thousands of orders quickly and reliably with a minimum of hardware inv
Re:its a problem (Score:2)
I'm sure it's interesting work, but do you realize that your software skills are being used to create widespread instability and volatility in the stock markets? Banks try to constantly arbitrage whatever they can (quickly take advantage of price discrepancies, exploitable market inefficiencies) and if you are using a lot of leverage in the process, you are contributing to a stock market that has become nothing more than a speculator's playground.
Re:its a problem (Score:2, Insightful)
a market cannot work without people arbitraging, speculating and investing.
his skills are being used to reduce transaction costs and inject liquidity into the market, without which pension funds would operate at a much higher cost.
Re:its a problem (Score:2)
All investing is speculation. You can take some risk out of it by doing lots of research,
Input Validation? (Score:1)
Re:Input Validation? (Score:3, Funny)
Re:Input Validation? (Score:1, Informative)
This btw, is not the fi
Re:Input Validation? (Score:1)
Why would you think that? It's not like these people are going to be held accountable for their errors...
Not as uncommon as you think (Score:5, Interesting)
The real lesson is that stocks don't really have "a price" in a traditional sense. (At best, the price on the last transaction serves as a proxy, but is no guarantee of getting that price in the future). In reality, stocks have both a bid and an ask price. For thinly traded stocks (especially in the off-hours), the bid-ask spread can be very very large.
Buyer (and seller) beware.
Re:Not as uncommon as you think (Score:1)
Re:Not as uncommon as you think (Score:3, Funny)
Re:Not as uncommon as you think (Score:2)
Re:Not as uncommon as you think (Score:2)
Re:Not as uncommon as you think (Score:1)
the unidentified trader was... (Score:4, Informative)
Looks like we're going to war with Japan... (Score:2)
2 Revealed! (Score:2, Funny)
Step 2: Await computer error
Step 3: Profit!!!1!
In Soviet..erm, I'd like to see a beow...uh, I for one, welc... oh, just forget it.
Ha ha! Funny stuff (Score:4, Informative)
Do you have any idea how crooked stock trading through middlemen is? There are a thousand ways the retail investor and small trader gets screwed. For instance, market makers are definitely not impartial and favour their own trades ahead of clients'. You can not even catch the fraud the occurs. There are about a dozen NYSE market specialists that are charged with fraud every year.
There is absolutely no reason to involve humans in the securities trading process any more. None! The rampant fraud can be easily avoided. When things like this are publicized, I almost wonder if it's got some bias in favor of the human trade specialists who make trading floor operations tick. They're useless middlemen, profiting from spreads and leverage.
Electronic trading is the only way to go. When an exchange switches to electronic, you should see that as a sign of quality and a commitment to do away with the fraud that EVERY insider knows is a standard mode of operation in stock trading.
Re:Ha ha! Funny stuff (Score:2)
Just a thought... (Score:2)
If I had been interested in Maxco, Inc. stock, I would be watching the price and waiting for it to hit around $4 before buying, or perhaps be willing to buy it up to $5, if I thought it was going to keeep going up.
If it was at $951, I wouldn't buy it, since that's orders of magnitude higher than I expect it to be in a week.
I would assume wall street traders similarly limit the price when they buy.
(I do pity t
technical analysis (Score:2)
There is a branch of investing called technical analysis. What people who follow it do is use various formulas to look for stocks that are moving. These people intentionally know nothing about the stocks they are trading.
Technical analysis works because it assumes that others are doing their homework, and so you can follow their lead and get almost as much gain as they do. When prices jump as happened in this case, technical analysis would say buy (depending on the formula of course) assuming someon
I work for a fairly large electronic marketplace (Score:5, Insightful)
Re:I work for a fairly large electronic marketplac (Score:2)
I think this is unjust, personally. I think stock exchanges should never cancel erroneous trades, because that penalises those who took advantage of errors, but does not penalise the source of the error. The source of the error should be penalised, on the "it's your fault, you pay for it" principle - which w
about money (Score:2, Insightful)
No, I wouldnt (Score:2)
High-school dropouts who don't care eh? (Score:2)
(ok, I just graduated yesterday so I don't quite fit the dropout bit, so sue me)