Operational risk possible cause of US equity nose-dive
Fat finger error mooted as possible cause for US market plunge
Thursday's dramatic 998.5 point drop in US market prices was caused in part by lessons ignored from the 'Black Monday' UK stock market crash of 1987. The crash and rebound was reportedly initially caused by a 'fat finger' trading error, which then triggered automated selling programmes to sell off stocks, causing the drop to briefly spiral out of control.
Automated selling systems, designed to
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