Ok, get this, the algorithm had only been created the night before and only had one or two hours of testing…hmmm…how about those algos in healthcare? It does make you stop and think as we don’t have the “speed” issues as much but there are big influxes of data tables being searched today. There’s more of this going on than most of us are aware of, only the ones who get caught. This is part of the Occupy movement and why I said “Occupy Algorithms” as you can see what’s moving the money, the math.
“Occupy Algorithms”–”The Attack of the Killer Algorithms Part 5” - Nothing Will Improve Until Audits and Actions Takes Place To Correct Formulas Built for Profit Only by Corporations And We Battle Back With Math
Not too long ago the SEC filed suit against this Quant who knowingly used software for 3 years that was not calculating correctly…get that, 3 years.
SEC Sues Quant–Undisclosed Error in Trading Algorithm- Miscalculating “Risk”-Healthcare Software Evaluates This Factor Too
Where else but on Wall Street can one get “certified” to run servers on over clocked processors! That’s another dangerous process and can lead to those algorithms going out of control too. There’s software on those chips.
Gamers Are Not the Only Ones to Over Clock Processors-Turns Out It’s Done on Wall Street To Run Those Algorithms at Rocket Speed
It's very much algorithmic warfare, with no real thought given to collateral damage. They get a fine and just keep on going? BD
The operator of futures and other derivatives markets fined Infinium Capital Management for malfunctions on Oct. 27 and 28, 2009, that led to what Reuters called “uncontrolled selling of e-mini contracts on the Chicago Mercantile Exchange. ‘’
In the third incident, on Feb. 3, 2010, Infinium appeared to lose control of an algorithm that lost control of an algorithm that “bought oil futures in rapid succession on the New York Mercantile Exchange.”
CME owns both the Chicago Mercantile Exchange, from which the group’s name derives, as well as the New York Mercantile Exchange.
Infinium's buying on Feb. 3 lat year led to a $1 surge in oil prices as the computer program sent thousands of orders per second, Reuters reported.
Infinium suffered a million-dollar loss, but did not admit or deny violating exchange rules in the incidents.
In the 2009 cases, CME found that Infinium errantly sold 6,958 December-dated e-mini Nasdaq 100 Index futures in the span of seven seconds early on Oct. 28.
A similar malfunction with the same so-called automated trading system happened on Oct. 7, though Infinium "took no further action to correct, modify, or disable" it before Oct. 28, according to the Reuters report.