Interesting People mailing list archives
IP: don't hit that key -- from Risks
From: Dave Farber <farber () cis upenn edu>
Date: Sun, 29 Nov 1998 17:21:00 -0500
From: Chris Brand <cbrand () west raytheon com> Subject: German stock exchange bond futures goof Date: Thu, 19 Nov 1998 16:36:14 -0800
From the Electronic Telegraph (http://www.telegraph.co.uk:90), 19 Nov 1998:
A junior trader cost his employers an estimated 10 million pounds yesterday after a training exercise went disastrously wrong and he ended up taking part in an 11.5-billion-pound transaction. The trader, who is believed to work for a German financial institution, pressed the wrong buttons on his computer and caused panic on dealing floors in the City. Screens flashed up with the news that someone wanted to sell 130,000 German bond futures contracts, worth in excess of #11.5 billion. [...] The German-based trader's employers are contractually obliged to carry out the transaction, and will be forced to buy futures contracts in the open marketplace to complete it. One banker said: "His employers must have extremely lax controls. A trade that size should have sent alarm bells ringing." [...] German bond futures are now predominantly traded on Eurex, a German-based electronic exchange, on which traders say it is relatively easy to enter the dealing programme instead of the training simulation programme. [...] Chris [also noted by Nathaniel Borenstein <nsb () si umich edu> and "Koblizek, Vaci" <Vaci-Koblizek () deshaw com>. PGN] _____________________________________________________________________ David Farber The Alfred Fitler Moore Professor of Telecommunication Systems University of Pennsylvania Home Page: http://www.cis.upenn.edu/~farber
Current thread:
- IP: don't hit that key -- from Risks Dave Farber (Nov 29)