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High frequency trading and Twitter can prove to be a lethal cocktail for financial markets.

It’s hard to argue recent market volatility triggered by a fake White House tweet didn’t get snowballed by high-speed computerized trading leading to a “flash crash” that briefly knocked $140 billion off the S&P 500, reports FT.com.

High-frequency trading in the U.S. is getting much heat from the FBI and SEC, which have joined forces against manipulative trading practices powered by ultra-sophisticated algorithms.

Also read:

Will RCMP monitor electronic trades?

IIROC issues guidance on deceptive trading

Concerns about high-frequency trading

Originally published on Advisor.ca