Featured Articles

Nvidia Shield 2 shows up in AnTuTu

Nvidia Shield 2 shows up in AnTuTu

Nvidia’s original Shield console launched last summer to mixed reviews. It went on sale in the US and so far Nvidia…

More...
AMD CSO John Byrne talks ARM

AMD CSO John Byrne talks ARM

We had a chance to talk about AMD’s upcoming products with John Byrne, Chief Sales Officer, AMD. We covered a number…

More...
AMD Chief Sales Officer thinks GPU leadership is critical

AMD Chief Sales Officer thinks GPU leadership is critical

We had a chance to talk to John Byrne who spent the last two years as Senior Vice President and Chief…

More...
OpenPlus One $299 5.5-inch Full HD phone

OpenPlus One $299 5.5-inch Full HD phone

OnePlus is one of the few small companies that might disrupt the Android phone market, dominated by giant outfits like Samsung.…

More...
KFA2 GTX 780 Ti Hall Of Fame reviewed

KFA2 GTX 780 Ti Hall Of Fame reviewed

KFA2 gained a lot of overclocking experience with the GTX 780 Hall of Fame (HOF), which we had a chance to…

More...
Frontpage Slideshow | Copyright © 2006-2010 orks, a business unit of Nuevvo Webware Ltd.
Thursday, 11 October 2012 10:27

Skynet starts trading

Written by Nick Farrell



Preparing to crash the stock market


It looks like a mysterious computer program was testing ways it could stuff up Wall Street last week. According to CNBC a single mysterious computer program placed orders and then subsequently cancelled them. It made up four percent of all quote traffic in the U.S. stock market last week. The motive of the algorithm is still unclear but it placed orders in 25-millisecond bursts involving about 500 stocks.

The algorithm never executed a single trade, and it abruptly ended at about 10:30 am. Eric Hunsader, head of Nanex said that it goes to show you how just one person can have such an outsized impact on the market. His system picked up that this was a single high-frequency trader after seeing the program’s pattern. It made 200 fake quotes, then 400, then 1,000 and  repeated everything. Also, it was being routed from the same place, the Nasdaq.

It could be that the software was testing the market. Sometimes software is used to stuff up the system so it slows down the quote feed to others and allows the computer traders to gain a money-making arbitrage opportunity. Of course it could be a single terrorist hacker which was working out a way to bring down the west by crashing Wall Street. But that would just be FUD and the sort of thing you could make a movie about. After all if the Internet became self aware and wanted to screw up humanity it could bring down the stock market just by carrying out such attacks.

This single program accounted for 10 percent of the bandwidth that is allowed for trading on any given day. In the US there is an investigation into wealth-destroying events such as the Knight Capital Group computer glitch in August and the market “flash crash” two years ago. Regulators are trying to see how they can rein in the practice, which accounts for 70 percent of trading each day, without slowing down progress and profits for Wall Street and the US exchanges.


Last modified on Thursday, 11 October 2012 10:47

Nick Farrell

E-mail: This e-mail address is being protected from spambots. You need JavaScript enabled to view it
blog comments powered by Disqus

To be able to post comments please log-in with Disqus

 

Facebook activity

Latest Commented Articles

Recent Comments