Tuesday, January 26, 2010

When Androids Attack: Computer Driven Trading Could Lead To A Financial "Meltdown"?

Something else to be concerned with this morning - possible android attacks on the financial system:

"An explosion in trading propelled by computers is raising fears that trading platforms could be knocked out by rogue trades triggered by systems running out of control.

Trading in equities and derivatives is being driven increasingly by mathematical algorithms used in computer programs. They allow trading to take place automatically in response to market data and news, deciding when and how much to trade similar to the autopilot function in aircraft.

Analysts estimate that up to 60 per cent of trading in equity markets is driven in this way."

Maybe we should back to the old fashioned trading pit?

(h/t Drudge)

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