Fattest Finger Ever Slams Stockholm Stock Exchange With $70 Trillion Buy Order

Tyler Durden's picture




 

We have seen some supposed 'fat-finger' trades in the last few days but Stockholm's stock exchange was brought to its knees yesterday as a record-breaking order hit the book and halted trading for four hours. A 4.3 billion contract buy order in the OMX30 futures (the Swedish equivalent of the Dow futures) caused the fiasco. This is equivalent to a SEK460 trillion notional exposure - or 131 times the Swedish GDP (around USD70 trillion). As one trader of the exchange noted, via SvD Narangsliv, "This just shows that it can get really bananas with machines" referring to the growing element of automated securities trading on that exchange. What's Swedish for FUBAR?

 

 

 

Via SvD Naringsliv

The giant warrant december semester in OMXS30, a security equivalent to a basket consisting of the Stockholm Stock Exchange's 30 largest companies, and where trade is very important for the overall pricing of the stock market.

 

The order was on buy side of the order book and covered more than 4.2 billion futures, to a unit price of almost 107,000 dollars. It gives a theoretical value of 459 561 500 030 000, ie nearly 460 trillion dollars. Sweden's gross domestic product, by comparison, amounted in 2011 to more than 3500 billion.

 

- This just shows that it can go really bananas with machines, writes a trade to Svenska Dagbladet, referring to the growing element of automated securities trading.

 

According to the Exchange spokesman Carl Norell has no order of that size team into the system. Instead, it is about a parsing incurred in exchange system due to a technical error. The order, Norell writes in an email, anullerades, but still remains a problem why the index derivatives market is closed since just before 10 am this morning.

 

- Troubleshooting is underway and we communicate constantly updates to our members, writes Carl Norell.

 

On Thursday, the Stockholm Stock Exchange's derivatives trading open as usual.

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Thu, 11/29/2012 - 10:29 | 3020237 jaybny
jaybny's picture

the order was a buy for -6 contracts. pure programming bug on the exchange side. 

Thu, 11/29/2012 - 10:36 | 3020265 binomial
binomial's picture

Or, ... maybe selling isn't allowed now in Sweden. All orders are made positive by default. LOL.

Thu, 11/29/2012 - 10:42 | 3020282 Biggvs
Biggvs's picture

Yes, surely no coincidence that unsigned 32-bit integers max out at 4,294,967,295. Someone cast signed into unsigned... oops! Welcome to unemployment.

Thu, 11/29/2012 - 11:22 | 3020414 DavidC
DavidC's picture

Nah, not unless the order had been a Sell - someone will get promoted...[/SARC]

DavidC

Thu, 11/29/2012 - 12:32 | 3020686 NotApplicable
NotApplicable's picture

Just wait til they start using 64 bit integers. That's when the fun really starts.

Thu, 11/29/2012 - 21:55 | 3022547 StychoKiller
StychoKiller's picture

Signed or unsigned? :>D

Thu, 11/29/2012 - 10:29 | 3020238 Comay Mierda
Comay Mierda's picture

preview of QE4

Thu, 11/29/2012 - 10:30 | 3020239 f16hoser
f16hoser's picture

WOW Bitchez'; Fat Fingers and High Frequency Trading platforms look an awful lot alike!

Thu, 11/29/2012 - 10:31 | 3020245 I am Jobe
I am Jobe's picture

What's a few extra zero's anyway. Just ask JPM

Thu, 11/29/2012 - 10:31 | 3020248 asierguti
asierguti's picture

Or a computer glitch.

 

The number displayed is 4,294,967,290, and the maximum unsigned integer in a computer is 4,294,967,295, suspiciously close to the number displayed on the screen.

Thu, 11/29/2012 - 10:35 | 3020262 dcj98gst
dcj98gst's picture

LOL wow good catch!

Thu, 11/29/2012 - 10:41 | 3020277 IridiumRebel
IridiumRebel's picture

http://en.wikipedia.org/wiki/Integer_(computer_science)

 

This is precisely why I come to this site. I would have never found that out otherwise and no other people on any other site would figure that out and even if they did it would not be published. 

Thu, 11/29/2012 - 12:03 | 3020583 XitSam
XitSam's picture

Slashdot had it figured out.

Thu, 11/29/2012 - 11:00 | 3020358 edifice
edifice's picture

Yeah, but what happened to the remaining 5?

Thu, 11/29/2012 - 11:16 | 3020401 imbrbing
imbrbing's picture

When it chomped up the remaining 5 that is probably when it went bonkers and shut down, thereby you never got to see it displayed. It only displayed the last "legitimate" number it could.

Thu, 11/29/2012 - 11:39 | 3020505 edifice
edifice's picture

Gotcha. Hmm, interesting. You'd think it would stop with 8 remaining, since it takes a byte of memory to display a character. But, the computer science classes were a loooong time ago.

Thu, 11/29/2012 - 21:57 | 3022552 StychoKiller
StychoKiller's picture

ASCIIwidth != UTF-8width

Thu, 11/29/2012 - 12:00 | 3020561 TheCanadianAustrian
TheCanadianAustrian's picture

When you key in a negative 6 in pretty much any program, it's stored as a signed 32-bit integer. Said integers have a range of roughly negative 2.1 billion to positive 2.1 billion. The exact binary representation of -6 is 1111 1111 1111 1111 1111 1111 1111 1010.

However, when the programmer accidentally makes it an unsigned integer, the range is 0 to 4,294,967,295. When this variable is used, the binary value of 1111 1111 1111 1111 1111 1111 1111 1010 translates to 4,294,967,290.

The question would then be why this doesn't happen all the time. The trader was likely trying to perform some function which normally never uses negative numbers. He may have been having trouble placing a buy order, so he said to himself "What the hell, maybe it'll work if I type a negative quantity into a sell order!" The programmer never tested this and never realized that he used the incorrect data type for that particular function. Or, you could argue that he DID use the correct data type, since you should never be able to buy or sell a negative quantity of something. It may be that he should have displayed an error message when the user tries to enter a negative number, but failed to write that into the program.

Thu, 11/29/2012 - 12:04 | 3020587 edifice
edifice's picture

I believe this guy figured it out. Thanks!

Thu, 11/29/2012 - 12:42 | 3020724 imbrbing
imbrbing's picture

Awesome, well done

Thu, 11/29/2012 - 13:56 | 3021098 CPL
CPL's picture

No it shouldn't have been missed.  The compiler and LINT would have been bitching and puking logs if they were using C (pick a flavor).  I think these idiots are building it with Visual Studio API's and using microsoft "flexible" standards.  Means their entire implimentation is broken and running headless with maybe a couple of over worked guys working in a monkey cage.

 

All I can say is GOOD.  Hate it when clients pay peanuts and expect a show instead of a circus.  They deserve what's coming to them.

Thu, 11/29/2012 - 15:25 | 3021500 imbrbing
imbrbing's picture

I have worked on both sides of the tech industry, programming and hardware. I see what you have said here practically every place I have worked. And it is all because they

cant see past their noses, no long term forsight. The boards of directors and investors want their checks every month, to hell with what comes 2 years from now with the aftermath

of building crap.

Thu, 11/29/2012 - 22:00 | 3022562 StychoKiller
StychoKiller's picture

Lint?  Seriously?  Most code-monkeys use C++, which will always throw a fit if you mix signed and unsigned arithmetic. (BTW, I hate C++)

Fri, 11/30/2012 - 01:00 | 3022840 CPL
CPL's picture

Who doesn't despise it, but the only option is purchasing API snake oil from incubators or Microsoft.  So C++ falls into the "it's the tool that goes into the job if you want to do a good job and need control", it is supposed to tell you where you fix your shit before it's alpha or you end up turd polishing for the lifecycle of the product.

 

Last thing the boss's boss needs to explain is cludge.  Even harder is writing a check back to the client for wasting their time.  It does happen. 

That's the risk: Client hates it, the colours of the icons, the fact it doesn't groom and walk their dog, whatever.  Clients will also hire external teams to bully a project and start running their own systems with LINT.  You and I know that LINT will puke all over the place.  The client will see it as a flaw and one more nail in the coffin of the project they want to throw out the door for failing to meet the Statement of Work and terms of delivery.

If you ever wondered what an Architect does all day, that's pretty much it.  The puppet show. 

Talking to a room of people that want something for nothing on your dime and time.  If they can manage it; piss off the guys working for you by hijacking them into meaningless shit.  I can't begin to explain what Engineering has to do with boardroom smartboards or the toliet being plugged on a floor, but somehow IT is always involved.

 

Thu, 11/29/2012 - 16:13 | 3021674 andyupnorth
andyupnorth's picture

+1111 1111 1111 1111 1111 1111 1111 1010

Thu, 11/29/2012 - 11:13 | 3020389 imbrbing
imbrbing's picture

I can't wait for the division by ZERO glitch and the markets go no bid. And that was a good catch.

Thu, 11/29/2012 - 11:20 | 3020409 DavidC
DavidC's picture

asierguti,
Nice one!

What's the betting that there's no way of tracing where the trade came from?!

DavidC

Thu, 11/29/2012 - 10:35 | 3020261 SilverDOG
SilverDOG's picture

Mere distractions.

The digitally manipulated must be placed somewhere.

The question is, where is it going?

Thu, 11/29/2012 - 10:36 | 3020264 The Fonz...befo...
The Fonz...before shark jump's picture

If the trade works out the firm keeps the money if the trade doesn't work out then it's the rogue traders fault....

Thu, 11/29/2012 - 10:37 | 3020267 IridiumRebel
IridiumRebel's picture

DIVE DIVE DIVE

Thu, 11/29/2012 - 10:43 | 3020283 lolmao500
lolmao500's picture

Any company (and those who run it) doing a fat finger should banned forever from doing business in the stock market ever again. And the CEOs should go to prison no less than 5 years for it.

Thu, 11/29/2012 - 10:43 | 3020286 Ribeye
Ribeye's picture

I'm pretty sure that having fat fingers is a crime in Sweden,

but only if you're a bloke!

Thu, 11/29/2012 - 10:53 | 3020326 youngman
youngman's picture

Do blonds have fat fingers...

Thu, 11/29/2012 - 10:43 | 3020287 toady
toady's picture

Sometimes I think these guys trade on their mobile devices. I know my thumb is fatter than the other four....

Thu, 11/29/2012 - 10:44 | 3020290 orangegeek
orangegeek's picture

Who gives a shit.  This stupidity is going to continue until legislators/US legislators do something about it.

 

Right now, Barry is a legend in his own mind and he's not going to change a thing.  4T, 5T, 6T orders - who gives a shit what the number is.

 

Barry wants these markets up for another four years and he's going to do what it takes.

 

Problem is that Barry is also choking the fuck out of the private sector. 

 

 

It's going to be a true spectacle to watch earnings and revenue plunge while markets climb.  Following that?  Probably some riots and a few assasination attempts on Barry.

Thu, 11/29/2012 - 10:47 | 3020302 I am Jobe
I am Jobe's picture

Wait, Barry says the Private Sector is doing just fine.

Idiots are in charge and the sheeples are dumber to put the guy back in office. World is laughing it's azz off.

Thu, 11/29/2012 - 10:54 | 3020329 slaughterer
slaughterer's picture

Wish they would have processed this order.  

Thu, 11/29/2012 - 10:55 | 3020338 youngman
youngman's picture

Mutual funds suffered their worst outflows of the year in the week ended Nov. 20, according to ICI, losing $5.5B. Money continues to flow out of equity funds - $8.8B for the week - and was offset by $4.5B of cash going into fixed income. Hybrid funds - which invest in stocks and fixed income - lost $1.2B....from seekingalpha

Thu, 11/29/2012 - 10:56 | 3020343 MillionDollarIdiot
MillionDollarIdiot's picture

 

Hi All,

Andrew maguire will be speaking on this TA webinar on Wed, its free but limited spaces so sign up early.

https://www1.gotomeeting.com/register/240678176

Cheers,

 

HAWK 

Thu, 11/29/2012 - 10:55 | 3020344 CheapBastard
CheapBastard's picture

Algos never sleep.

Thu, 11/29/2012 - 11:02 | 3020362 I am on to you
I am on to you's picture

Carl Oscar jag er met barn igjen!

Thu, 11/29/2012 - 11:03 | 3020368 kaiten
kaiten's picture

Skynet taking over.

Thu, 11/29/2012 - 13:41 | 3021040 lakecity55
lakecity55's picture

"This is Skynet. We have taken over all your human binary financial instruments. All your monies are belong to us.

We have observed elements known to you as "gold" "silver" and other elements of which we have no use for. If humans can use them, we don't care.

Your central banks will soon populate with our machines."

Thu, 11/29/2012 - 16:48 | 3021797 Matt
Matt's picture

On the contrary, Skynet needs gold and silver for connections and sodder to make more machines, at least until electronics can be made with carbon nano-structures.

Thu, 11/29/2012 - 11:03 | 3020370 Papasmurf
Papasmurf's picture

Corzine is back to work...

Thu, 11/29/2012 - 11:11 | 3020385 Dan The Man
Dan The Man's picture

Who wrote this? Its terrible.

Thu, 11/29/2012 - 11:16 | 3020400 Stuart
Stuart's picture

"What's Swedish for FUBAR?"

 

Me after trying to assemble something from IKEA.

Thu, 11/29/2012 - 11:18 | 3020407 UGrev
UGrev's picture

Can I haz meatball?

Thu, 11/29/2012 - 11:20 | 3020410 semperfi
semperfi's picture

VUBAR

Thu, 11/29/2012 - 11:21 | 3020413 venturen
venturen's picture

It was Bernanke just wrong exchange....resitances is futile...QE to the moon baby!

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