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Apple Stock Trading Halted Briefly on Sudden 9% Drop

A $60,000 Trade Does Not Explain It

Somebody got their facts wrong. According to the first post, a single trade for less than $60,000 dropped the market cap of a 600,000,000,000 (600 billion) company by $54 billion. A $60,000 trade wouldn't impact the nearest cent of the share price.
 
I really love chatting about the market and investing, but the general lack of knowledge about basic investing and finance on this board is so discouraging it sours the fun. I'll get down-voted for sure, but I'd just urge people to learn about this stuff before making ridiculous statements. I don't go into threads about photography on macrumors and make posts acting like I know something I clearly don't, so it would be nice if people did the same.
 
iMikeT said:
%$#@$#!!!!! Why didn't my this trigger my long position? I would've made some good money in less time that it takes to fry an egg.
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No, you wouldn't. You should be happy it didn't happen. Your trade would have been reversed. Assuming you placed the order on NASDAQ (most likely, for a public customer) the "clearly erroneous" limit on AAPL when the market is open is 3%.

What's worse, you could wind-up losing money. What if you sold the shares for an "immediate profit" like you say. And your selling price was under the market price, but inside the "clearly erroneous" guidelines?

Your buy would be busted, but not your sell. Now you are short, and, worse, you are naked short and on an improperly-marked sell. (Short sales have to be marked as such.) Your account is probably not approved for naked shorts. You will be required by regulation to cover your short position, and your broker will do this for you, at market price. You will lose money. You don't get to bust your sell order just because your buy order was busted.
 
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Its called Block trade. Anyone with some stock market experience knows that. And no...you won't be able to trade it at that low price...

Move along....nothing to see here
 
Apple is the most important company traded on Nasdaq. If you think the powers that be are going to let their darling crash (even if warranted), think again.

If there was an errant rise of 10% it would stay.
 
ipoppy said:
Its called Block trade. Anyone with some stock market experience knows that. And no...you won't be able to trade it at that low price...

Move along....nothing to see here
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I don't think so. Block trades are very large private stock transactions. This one was supposedly 100 shares and publicly traded.

Probably all there is to see here is that the electronic trading systems can go berserk. Fortunately the safeties kicked in, but they are only necessary because berserk can happen. Not a big deal in the scheme of things, but not very reassuring either.
 
poorracerkid said:
Somebody got a good deal on 100 shares. Probably an old buy order. I'm sure there will be conspiracy theories galore now. :rolleyes:
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Again: nobody "got a good deal" on 100 shares.

Their trade was busted. As if it never happened. They thought they bought the stock, but they didn't. If they subsequently sold the stock (that they didn't own), normally, they would be required to cover the short and absorb any loss that ensued.

However, in this case, it was almost certainly an error on the part of the exchange. It appears that they either disseminated an incorrect quote or executed a trade erroneously. (And apparently did so on a range of symbols, not just Apple.) BATS will probably cover any loss since it was not the trader's own error.
 
Computer Trading

Did someone say algorithms..?? There are buildings closest to the internet hub in Manhattan that have been gutted to contain high speed super computers with algorithms that catch the slightest change in market fluctuations. A majority of stock trades are no longer being done by human beings. Remember May of 2010 when the market suddenly loss over 700 points in less that a half hour?? These super computers determine what stock to buy and trade.:(
http://www.ted.com/talks/kevin_slavin_how_algorithms_shape_our_world.html
 
I only have a few hundred shares, but I got sick when I saw the alert come up.
Ive just been holding 180, now 360 shares for almost 10 years. I don't gamble or trade. This stuff has to stop. The whole market is rigged and crazy.
 
Now the financial news is reporting "Apple flash crash" as well as "battery problems".

The stock issue was 100 shares traded on an apparently hacked or server crashed electronic market, akin to over the counter. The single trade was reversed. The BATS trading market has been in business for several years and I use it daily for some trades with no issues. They announced 10 minutes before the single erroneous trade they were having issues. They are on top of it.

The iPad battery issues relate to how the onscreen indicator comports with field use power levels. It seems the factory calibration at launch was 10% imperfect and just as they did with iPhone 4 wireless reception indicators, they will simply address it in the next software update. As it is now, it indicates full on recharge about an hour or less before it is really fully recharged. Short term solution, leave it on an extra half hour when convenient when charging.

The stock price chart still has several unfilled gaps, so when the market in general corrects during the next month, AAPL is likely to follow. That will be a buying opportunity for the year which will be hard to beat. Keep your powder dry. If you are a trader, consider taking some profits soon.

Rocketman
 
Rocko1 said:
House of cards.....
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If all it takes to send Apple crashing down 9% is a sale of a lousy 100 shares (yeah worth a lot now, but some people bought at under $100 a share), I think maybe it REALLY IS a house of cards. Get a few thousand people to sell off 5 shares and what would happen to Apple's stock? $400? $300? $80 again? I've got to wonder what sent it reeling from around $200 to $83 a couple of years ago. Maybe it wasn't as many selling off as I imagined. :confused:
 
What about, next iPhone to keep having 3.5" ???

I won't buy and most of the people I know who are Apple followers swore they won't either.
 
tangorum said:
What about, next iPhone to keep having 3.5" ???

I won't buy and most of the people I know who are Apple followers swore they won't either.
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It's a rumor. Besides, I don't trust you and most of the people you know to predict sales of the next iPhone.

Before the iPhone 4S was announced rumors about the iPhone 5, with its teardrop shape, larger screen, and LTE filled the tubes of the interwebs until they were nearly overflowing. I also heard pronouncements about what individuals would or wouldn't accept.

Then the iPhone 4S appeared, looking exactly like the iPhone 4. There were several spec bumps, and a new, exclusive feature (Siri) to capture the imaginations of those who have such a thing. Sales have been very impressive.

You may be telling the truth, and you may not change your mind. The screen size may be the only feature you care about. Even if the next iPhone has a quantum entanglement antenna that allows you to use it worldwide, on the moon, in elevators, subways, and salt mines with no signal degradation and no fees and unlimited data/voice, you may say "but it only has a 3.5-inch screen, so I'm not interested."

You may not be interested, but I'll probably be upgrading (even without the QE antenna that I just made up). My iPhone 4 will be about 26 months old, and I'll be looking forward to taking Siri 2.0 for a spin. (Or will it be Siri 1.0, since the current version is a Beta?)
 
jtara said:
It sounds like a software bug.

If you're having "issues" like this, you have to shut down.
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It was a pleasure to read a smart post. BATS in fact did shut down in a sense. They announced a halt to trading in their own 1st day stock IPO and later in the day announced they are rescinding their IPO entirely. They terminated all trades that were erroneous just as you indicated.

Smart move. They can reissue the IPO after they resolve the issue.

This is making known to the general public a serious systemic issue that needs real attention. http://www.nanex.net/FlashCrash/OngoingResearch.html

Sorry for some of the loose use of terms in my contemperaneous post.

Rocketman
 
jtara said:
Actually, no, markets have put in place limits of how far away-from-market a trade can be. In fact, I was involved early in high-frequency trading starting around 2000 (no longer involved) and we'd get "busted trades" every day. At first, these were on a case-by-case basis. And then the exchanges slowly started adding formal policies with explicit limits. You trade outside of those limits, your trade WILL be busted. Our software had maximum limits to minimze the number of busted trades. Sometimes you would still get busted even if within the limits. The limits just serve as prima facea evidence of an erroneous trade.
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A few years ago a trader in Japan made a mistake - instead of selling 100 shares for 10,000 Yen he sold 10,000 shares for 100 Yen. And that trade went through.
 
bedifferent said:
I love the concept of the stock market/economy. It's so fragile and yet it drives so much of our lives. Lord.



Riiiight?! I loved the 2008 campaign when certain politicians stated "The fundamentals of the economy are strong" then BAM, the biggest economic disaster since the Great Depression.

*le sigh*
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Right? Far from it. The snowball started rolling before the November 2008 elections. Bailouts began under GW's watch. Do you even realize what economic condition this country would be in today had the auto industries failed?

Had the fundamentals of the economy not been strong, we would not see DJIA above 13,000 today.

chainprayer said:
Wirelessly posted

If someone was able to make a buy at that price successfully they just got $5,600 richer.
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Not too many people would be trading a small number of shares to make such an amount in one transaction unless they could afford to spend a lot more than $5,600. And to realize any profit, those shares would have to be sold at the higher price. If one wants to make real money on AAPL, he should have bought it in January 2009 when its price was below $80. Had I any money to spend, I would have bought stock in AAPL. He|| - I would have bought it when it first traded IF I hadn't been a poor school teacher.
 
doctor-don said:
Right? Far from it. The snowball started rolling before the November 2008 elections. Bailouts began under GW's watch. Do you even realize what economic condition this country would be in today had the auto industries failed?
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wait wait backup backup I agree. I read just the beginning before I responded (well, mostly agree).

(this is why I hate forums and emails and texts, easy confusion) :)
 
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Goldman Sachs taking OUR money out of their artificial run-up on the stock price these last few weeks.

What? No one's heard of 'pump and dump'? It's in the Goldman manual...
 
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