The invisible hand that pushed Apple up and down for six years

Re:The invisible hand that pushed Apple up and down for six ... by mschuster91 on Friday December 20, 2013 @05:45AM (#6940814)

Just remember that Knight Capital episode. Algorithm ran amok, they lost a decent chunk of money (460M US$!) and were bought out a couple of weeks later (http://en.wikipedia.org/wiki/Knight_Capital_Group#2012_stock...).

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Re:The invisible hand that pushed Apple up and down for six ... by hfttrader on Friday December 20, 2013 @06:28AM (#6940929)

That isn't really an example of market manipulation. Market manipulation is an intentional manipulation of the market. (http://en.wikipedia.org/wiki/Market_manipulation) The Knight Capital incident was an example of a firm performing bad trades due to an error in their systems. Their behavior certainly wasn't intentional or profitable.

HFT isn't based on market manipulation. Some HFT firms perform market manipulation, as do some non HFT firms, but this practice is illegal. (For example, newedge was recently fined for market manipulation)

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Re:The invisible hand that pushed Apple up and down for six ... by elemeno on Friday December 20, 2013 @08:05AM (#6941193)

The Knight Capital incident isn't unique to HFT firms - any firm that does automated trading can fall foul of similar problems.

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Re:The invisible hand that pushed Apple up and down for six ... by yummyfajitas on Friday December 20, 2013 @08:44AM (#6941306)

It can even happen to manual traders. If you accidentally screw up and run the wrong strategy (e.g. buying Tweeter Inc. when you intended to buy Twitter), you'll very rapidly lose gigantic piles of money.

Losing your money in the stock market != market manipulation.

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Re:The invisible hand that pushed Apple up and down for six ... by mschuster91 on Friday December 20, 2013 @04:42PM (#6944241)

Yeah, but the "HF" part of "HFT" tends to make an elephant out of a fly.

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