Showing posts with label stock market. Show all posts
Showing posts with label stock market. Show all posts

Thursday, February 16, 2012

The Power Of Nanosecond Trading

Red line represents the frequency of sub-650 millisecond flash crashes, and blue the frequency of flash spikes, between January 2006 and February 2011. The black spike is the S&P 500 index. Image: Johnson et al./arXiv

Nanosecond Trading Could Make Markets Go Haywire -- Wired

The afternoon of May 6, 2010 was among the strangest in economic history. Starting at 2:42 p.m. EDT, the Dow Jones stock index fell 600 points in just 6 minutes. Its nadir represented the deepest single-day decline in that market’s 114-year history. By 3:07 p.m., the index had rebounded. The “flash crash,” as it came to be known, was big, unexpected and scary — and a new study says flash events actually happen routinely, at speeds so fast they don’t register on regular market records, with potentially troubling consequences for market stability.

Read more ....

My Comment: So much for the small individual investor.