Sudden 9% drop in Apple stock triggers temporary trading halt [u]

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Comments

  • gqbgqb Posts: 1,934member
    Quote:
    Originally Posted by Sierrajeff View Post


    +1x10^8.



    This is not trading based on an analysis of a company's prospects, or to invest in a promising industry or trade; this is nothing more than pointless manipulation of the markets (and other people's hard-earned investments) for the sake of skimming a little cream.



    Again... RETURNING TO a small trade transaction tax would raise revenue, put a big crimp in these non-productive financial patterns, and affect only the 1%.



    Push an idea that can actually happen and makes sense.
  • jragostajragosta Posts: 10,473member
    Quote:
    Originally Posted by bigdaddyp View Post


    How the hell can a 100 share trade drive down a stock that much? Especially with Apples share price and volume?



    Two things:



    1. Computers monitor changes. If there's a dramatic change, it can automatically trigger a stop in trading - even after a single trade.



    2. Computer trading. It is not uncommon to have an order to sell if the price drops more than a certain amount. Thus, one weird sale can cause a lot more sales that would have a more permanent effect.



    Fortunately, nothing significant happened in this case. It appears to have been a computer error that was quickly corrected. No harm done.
  • asciiascii Posts: 5,363member
    I think it's quite a clever use of computers, making lots of micro trades and hoping it adds up. I don't think there's anything morally wrong with it, since every time you buy stock there must be someone else willing to sell, so no one's being forced.



    The selling entity might even be a program at another company that is making a different guess about the future, so the party that puts the best information in to their program wins over the long run, same as any trading.
  • thetroupethetroupe Posts: 11member
    Quote:
    Originally Posted by digitalclips View Post


    I sincerely hope this was an accident!



    Hope is a good thing to have but in this case it hope is not going to go far.



    Executing sell orders for small lots is the best way to start a panic. It's doable and legal, however immoral.
  • cityguidecityguide Posts: 122member
    Quote:
    Originally Posted by bigdaddyp View Post


    How the hell can a 100 share trade drive down a stock that much? Especially with Apples share price and volume?



    It wasn't the number of shares but the price at which they were offered ($542.80) that created the alert. A price change of either up or down by 10 percent in a five-minute period will kick in the circuit breaker to halt trading of that stock.
  • apple ][apple ][ Posts: 8,341member
    Quote:
    Originally Posted by CityGuide View Post


    It wasn't the number of shares but the price at which they were offered ($542.80) that created the alert. A price change of either up or down by 10 percent in a five-minute period will kick in the circuit breaker to halt trading of that stock.



    So it was one trader who messed up and put up 100 shares to sell at that low price?



    If somebody else had a limit order just for fun to buy 100 shares at 550 or less, then would they have gotten those shares? Somebody could have gotten a few AAPL shares for a nice discount in that case.
  • lkrupplkrupp Posts: 4,362member
    Quote:
    Originally Posted by Apple ][ View Post


    AAPL hasn't been doing that great for these past few days.



    And that's after Apple announced the dividend and the incredible iPad sales figures.



    I think that Apple should have spread that news out and not mentioned both on the same day.



    What? You are expecting a 3%+ rise day after day without end? The stock took a historic leap just a couple of weeks ago to $600 and pulling back a little is "AAPL hasn't been doing that great for these past few days." I really don't know about you.
  • monstrositymonstrosity Posts: 2,114member
    Quote:
    Originally Posted by SolipsismX View Post


    In other news Apple investors set the world record for the number of people exclaiming "Oh shit!" at the same time.



    Oh shit I didn't have an automatic buy in place. That's what I'm thinking.
  • freshmakerfreshmaker Posts: 468member
    Quote:
    Originally Posted by lkrupp View Post


    What? You are expecting a 3%+ rise day after day without end? The stock took a historic leap just a couple of weeks ago to $600 and pulling back a little is "AAPL hasn't been doing that great for these past few days." I really don't know about you.



    Agreed. A slight pullback would be expected with some folks taking profits. It'll continue ever upward, but will have a few dips along the way.
  • monstrositymonstrosity Posts: 2,114member
    Quote:
    Originally Posted by bigdaddyp View Post


    How the hell can a 100 share trade drive down a stock that much? Especially with Apples share price and volume?



    It can't.
  • backdocbackdoc Posts: 18member
    This is interesting. I never thought about proximity to the markets and how that might trading.



    Quote:
    Originally Posted by tundraboy View Post


    If your profitability depends on how near your servers are to the exchange's servers (so you beat the other high speed trader's to the punch) then this is no longer the type of trading the exchanges were designed for.



    These trading programs cheat by placing orders, taking a peak at the offers, then because they are fast enough, to cancel the orders in a blink of an eye if the price isn't right before the buy is executed. Or something to that effect. Conceptually, it's insider trading because you are privy to information that manual traders can't even take a glimpse at.



    And guess who's one of the biggest innovators, if no the biggest, in this type of trading? Yes! That giant vampire squid sucking on the face of humanity, Goldman Sachs.



    Whenever evil is being perpetrated in the financial world, Goldman Sachs is right smack in the middle of it.



  • apple ][apple ][ Posts: 8,341member
    Quote:
    Originally Posted by lkrupp View Post


    What? You are expecting a 3%+ rise day after day without end? The stock took a historic leap just a couple of weeks ago to $600 and pulling back a little is "AAPL hasn't been doing that great for these past few days." I really don't know about you.



    AAPL is doing great of course.



    I was just thinking about the immediate short term.



    Don't mind me, I'm just a greedy bastard looking to make a few quick bucks.
  • monstrositymonstrosity Posts: 2,114member
    Quote:
    Originally Posted by ascii View Post


    I think it's quite a clever use of computers, making lots of micro trades and hoping it adds up. I don't think there's anything morally wrong with it, since every time you buy stock there must be someone else willing to sell, so no one's being forced.



    The selling entity might even be a program at another company that is making a different guess about the future, so the party that puts the best information in to their program wins over the long run, same as any trading.



    I agree. You don't enter a game of football then get upset when the other team doesn't pass you the ball.

    It is a game, expect to play and outwit your opponent, else get burnt.
  • dmarcootdmarcoot Posts: 191member
    How does a computerized system that does buys and sells on "nanosecond price changes" have fat fingers? If anything they are obfuscating the fact that those who are wealthy enough to afford access to BATS and other such systems reap millions or billions by the nano second while mere mortals have to watch the market crash and rebound as they profit in both directions.
  • electraluxxelectraluxx Posts: 13member
    Quote:
    Originally Posted by Apple ][ View Post


    AAPL hasn't been doing that great for these past few days.



    And that's after Apple announced the dividend and the incredible iPad sales figures.



    I think that Apple should have spread that news out and not mentioned both on the same day.



    This is CLEARLY a day trader. Apple's stock has been through the roof the past few days. Maybe the past 3 days it's been down. But come on!!!



    I wonder if shareholders are irrationally jittery about an iPad recall. 98 degrees is hot!



    EDIT:

    Just read this: A single trade for 100 shares executed on a Bats venue briefly sent Apple, the world’s most valuable company, down to $542.80, triggering a circuit breaker that paused the shares. The order was executed at 10:57 a.m. New York time. Two more transactions, which sent the stock back above $598, were made before the halt. The stock stayed around that level once trading resumed.



    So it seems it WAS 100 shares. After looking at the ticker, and its steep sudden drop, it's clear something went awry. Maybe NASDAQ doesn't use Apple computers. This would never happen under OS X.
  • macologistmacologist Posts: 264member
    Example:
    • AAPL is around $600, and some people have Sell Orders at $590, 580, 570, 550 etc

    • AAPL suddenly drops 10% down to $540 for a few minutes or so, before the trading is halted by Wall St.

    Qs:
    • Can the SELL & BUY Trades be Cancelled in such situations?

    • At what price would the Cancellation Line would be drawn?

    • Does Wall St. have a Clear Rule for such situations, where Investors can clearly get punished! And, if there is a premeditated crime behind such computer glitches, then it's a clear case of $$$ being stolen from the investors!

    And then I remember the concept of Pump and Dump, which in a way does same thing, except its not as dramatic as today's computer glitch!



    Wall St. would have to say something like:



    We've seen $10-25 Drops on AAPL, Intraday or not, so we'll subtract that $10-25 Range from this Computer Error generated Drop, $60 Range = 10% of $600. Thus, every SEE & BUY Trade below $600 - 25 = $575 would be Cancelled, Invalidated, Undone!



    In the above example I just picked easy numbers to deal with, but I don't think I am too far off from the Historic AAPL Prices…



    I am looking forward to your Comments!
  • mightymikemightymike Posts: 49member
    Whoever bought when Apple stock took a dive and sold a little later made a ton of money. You just need to follow the money to see who profited. Then try to figure out how they were able to manipulate the stock and capitalize in realtime. Automatic trigger trades provide plausible deniability so it can get tricky.



    This much ultra short-term decline and rebound in Apple stock is unlikely to be an unintentional fat finger. That's why the Feds are looking into it.
  • syracusesyracuse Posts: 73member
    Quote:
    Originally Posted by Fairthrope View Post


    Are you sure? Nothing goes boom around Canary Wharf or Wall Street that somebody need to cash out right now?



    (portfolio or fund goes boom of course, not the building)



    I'm guessing here, but 100 shares doesn't smell like a hedge fund unwinding.



    Sounds like something my 2yr old would do tapping away on my computer...
  • aaarrrggghaaarrrgggh Posts: 1,539member
    Quote:
    Originally Posted by GQB View Post


    Wall Street ownership of Congress will keep an outright ban of high speed training from happening, but there is a solution that could be even better:

    Return to having a small tax (e.g. 1/4%) against each stock transaction. This is already done in most of the world.



    With the new IRS reporting structure that is being phased in, it is only a few more years before they will do withholding on all capital gains. I doubt they will do withholding on sales directly though; that is too obvious.



    If they withhold 38% of your 0.5% gain, the game gets much harder to play.
  • apple ][apple ][ Posts: 8,341member
    Quote:
    Originally Posted by Mightymike View Post


    Whoever bought when Apple stock took a dive and sold a little later made a ton of money.



    Not really, I read that it's been cancelled.
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