Wednesday, October 1, 2014

Just In Time! $617 Billion Japanese Fat Finger Trades Stopped at Last Minute

From Bloomberg.com:

Japan’s over-the-counter market was bombarded with $617 billion of erroneous stock orders in dozens of Asia’s biggest corporations.  They were canceled before they could be executed.

More than 40 requests to transact shares totaling 67.78 trillion yen ($617 billion) -- greater than the size of Sweden’s economy -- were voided at 9:25 a.m. in Tokyo before they could be matched, according to data compiled by Bloomberg...

The biggest order was for 1.96 billion shares of Toyota Motor Corp., or 57 percent of outstanding shares in the world’s biggest car maker, for 12.68 trillion yen through an off-exchange transaction...

One of the biggest American market makers, Knight Capital Group Inc., was pushed to the brink of bankruptcy in August 2012 when its computers spewed mistaken orders on to U.S. markets.

In that case, the orders found buyers and resulted in hundreds of millions of dollars in losses to the Jersey City, New Jersey-based firm. The company was later bailed out and sold.

While no such losses were recorded today because the orders weren’t filled, there should be an explanation to alleviate concerns [a market strategist said]...
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Link: http://www.bloomberg.com/news/2014-10-01/oops-possible-617-billion-trading-error-in-japan.html

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