Here are a few fat finger stories... In the last one, Mizuho lost more than $225 million. :eek:
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Typically, a fat finger can be spotted by a `spike.' An abnormally large number of transactions hit the market and get executed at the start of the spike. Fat finger trades have a long history charted by The Times (February 2005): A broker tried to sell 15,000 shares in music publisher EMI at 280¼p but instead placed an order for 15 million in a transaction worth £41.5 million.
April 2003: A trader accidentally bought 500,000 shares in GlaxoSmithKline, the pharmaceuticals group, at £13 each when the market price was 70p less.
November 2002: A market maker confused the price of Ryanair shares in euros and sterling, sending the London quote up more than 61 per cent, from 404.5p to 653.7p.
October 2002: A keyboard error at Eurex, the world's largest derivatives market, halted trade for three hours and caused its index to fall 500 points after an unidentified London trader entered the wrong price during a futures transaction.
September 2002: A Eurex trader intended to sell one futures contract when the DAX, Germany's index of leading shares, reached 5,180. Instead, he sold 5,180 contracts, sending the market into a free fall. Five hours later, the exchange announced the cancellation of a raft of other trades.
December 2001: A trader at UBS Warburg, the Swiss investment bank, lost £71 million in seconds while trying to sell 16 shares in Japanese advertising giant Dentsu at 600,000 yen each. He sold 610,000 shares at six yen each.
May 2001: A trader at Lehman Brothers mistyped a trade and wiped £30 billion off the stock market. He wanted to sell £3 million of stock but typed too many zeros and sold £300 million. The bank attracted a £20,000-fine.
November 1999: A dealer put his elbow on the keyboard and inadvertently placed 600 trades in 16,000 of the Premier Oil's shares at 19p, worth more than £1.8 million.
However, the record in fat finger trading is still held by a trader of Mizuho Securities, the broking arm of the Mizuho Financial Group of Japan. The trader had managed to sell shares worth £1.6 billion in a local recruitment agency, J-Com, which had just been floated and had a market value of little more than £50 million. The December 8, 2005, "sell" order, was mistakenly placed for 600,000 shares, despite the fact that J-Com had only 14,000 shares in issue. The order had created chaos in the market and had resulted in a 301-point fall on Japan's main stock market index, the Nikkei 225.
