#DisastrousBugs

Описание: In Episode 3 of #DisastrousBugs, we’ll analyse how a #softwarebug in a stock trading algorithm was responsible for the crash of one of the biggest financial firms in #USA, the #KnightCapital Group.

The Knight Capital Group's stock trading algorithm failure in 2012 was a significant event in financial markets. Knight Capital was a major player in the high-frequency trading (HFT) world, executing a large number of trades every day. On August 1, 2012, Knight experienced a catastrophic malfunction in its automated trading system, resulting in the execution of numerous erroneous trades over a span of just 45 minutes.

The glitch caused Knight to buy high and sell low in a variety of stocks, leading to a loss of approximately $460 million. This loss was substantial enough to threaten Knight's solvency, and the company had to secure emergency funding to remain operational. In the aftermath of the incident, Knight's stock price plummeted, and the company faced regulatory scrutiny and legal challenges.

The Knight Capital algorithm failure underscored the risks associated with high-frequency trading and the potential for technology-driven errors to have far-reaching consequences in financial markets. It also prompted increased calls for tighter regulations and oversight in the realm of algorithmic trading to prevent similar incidents in the future.

#scaler #bug #algorithm #failure #softwarebug
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