New flash crashes haunt stocks
Individual stocks are getting annihilated in computerized-trading errors. A sign of future disasters?
Get ready for the sequel: Spawn of Flash Crash.
Individual stocks are seeing miniature flash crashes with alarming frequency, The New York Times reports. One victim was Progress Energy (PGN), which saw its share price inexplicably plummet nearly 90% in September.
Other stocks, including Citigroup (C) and the Washington Post Co. (WPO), have seen similar erratic swings. One exchange-traded fund got hit as well, Graham Bowley writes.
Is this the new normal in today's computerized trading world? Or are these mini crashes the tremors that portend another market-destroying earthquake in the future? Post continues after video:
In the case of Progress Energy, the Times reports, a "wayward keystroke" by an unknown trader caused a computer algorithm that drove the price from $44.57 a share down to $4.57.
Even now, six weeks later, the company doesn't understand what really happened. And experts say that new trading technologies -- along with the market-manipulating potential they offer -- have created a monster.
"I am worried about the potential instability that these technologies create in market dynamics," Andrew Lo of MIT told the Times. "The U.S. equity markets have become the Wild, Wild West."
"I am upset by how high-speed traders have taken over the market," one mutual-fund manager added. "They make a mockery out of capitalism."
MORE ON MSN MONEY
Copyright © 2013 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.
The retailer labels the character's fake memoir as non-fiction. This comes weeks after it categorized the the Bible as fiction.
VIDEO ON MSN MONEY
Top Stocks provides analysis about the most noteworthy stocks in the market each day, combining some of the best content from around the MSN Money site and the rest of the Web.
Contributors include professional investors and journalists affiliated with MSN Money.
Follow us on Twitter @topstocksmsn.