Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : The coming US dollar crisis -- Ignore unavailable to you. Want to Upgrade?

To: Giordano Bruno who wrote (37960)	5/3/2011 4:58:11 PM
From: ggersh	Read Replies (1) \| Respond to of 71463

Trading , more like robbery! An Illustrated Fat Finger In Healthcare Stocks Causes Avalanche Of Broken Trades And Pain For Anyone With A Sub 30% Limit Submitted by Tyler Durden on 05/03/2011 16:33 -0400 Yesterday we reported that the NYSE was seeking to break a bunch of trades in healthcare related stocks, after an unprecedented surge sent Pfizer up to $90 and Eli Lilly over $60, Abbot Labs to $280, and JNJ to $100. Today, via MarketWatch we learn that this was not a now traditional HFT freak out, but apparently a "brokerage" fat finger. Why a brokerage would be executing in size at 6 pm Eastern, when the market to the best of our knowledge is beyond illiquid, is beyond us. From MarketWatch: "The sharp spikes in dozens of health-care stocks late Monday — trades eventually cancelled by two exchanges — were caused by a brokerage’s bad order on a basket of health-care stocks, said Nasdaq OMX exchange spokesman Frank De Maria. The exchange was not releasing the name of the brokerage, De Maria said by phone Tuesday. Late Monday, Nasdaq said it was cancelling trades in 26 healthcare stocks, and exchange operator Direct Edge decided to cancel trades on 52 stocks that traded more than 30% from their previous print and were executed between 4:57 p.m. and 5:05 p.m. Eastern. Cancelled trades included those of Boston Scientific Corp. , Medtronic Inc. , Aetna Inc. , Bristol-Myers Squibb and Baxter International." That said, if you were short into this flash smash with a stop loss that is 10%, 20% or even 29.99% away from the NBBO, you are fresh out of luck. And let that be a lesson to you: if you carry over a short from one day to the next, and have a sub 30% stop loss limit, you will likely see at least a 30% loss. Almost guaranteed.