It Was Cascading Stops In Futures

Discussion in 'Trading' started by HelloDollar, May 6, 2010.

  1. It's happened before. It'll happen again...
  2. +1 let's end the lies of a fat-finger causing this
  3. With all the levered ETF's, you've got to believe that futures are much more important now, leading to wider swings on days like this.
  4. Fat Finger BS.. Crescendo of algorithmic stops and automated position reversals. I'm sure the exchange message counts were off the charts...

    Most of these systems can send over 1000 discrete orders per second.
    You get just a few systems triggering orders and the domino's fall.
  5. agree.
  6. piezoe


    Now that makes a lot more sense than the "this is what happens when you elect an Osama" theory or "this is what happens when you tell Goldman that they can't lie, cheat and steal anymore" theory, or the "cleaning lady at Goldman with the errant mop handle" theory.
  7. Those BS theories only for calming general public, now, every local radio stations are pumping this BS in news hour. What a phony-baloney load of crap.
  8. The continuous and discrete hedge doesn't exist. Huge market orders hitting the tape in a vacuum, and in an electronic market. Yeah, you're going to see stocks trade at a penny.
  9. piezoe


    Agreed, Atticus. So what can be done. You know that at Art auctions there is a minimum bid. Bids below that are not entertained. Suppose there is a reasonable minimum bid in the market. You can't sell below there because there are no bids! I would say $0.01 is not a reasonable bid. What would you say?
  10. It's the only time I agree with a halt on shares. An arbitrary 30 minutes or for the remainder of the day if past 3pm. Assuming a volatility-based trigger.
    #10     May 8, 2010