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Data Glitch Sets Tech Company Stock Prices At $123.47 (theverge.com)

Posted by msmash on from the oops dept.

For one moment on Monday evening, the prices of several stocks on Nasdaq -- including those of Amazon, Apple, eBay, Google, and Microsoft -- were all priced exactly the same, $123.47. From a report: In a statement obtained by the Financial Times, Nasdaq said the culprit was "improper use of test data" that was picked up by third party financial data providers. The exchange said it was "working with third party vendors to resolve this matter." The issue was replicated across major financial websites, including Bloomberg, Google Finance, and Yahoo Finance, and it's not known when it all started.

34 of 52 comments (clear)

  1. Yeah for HFT! by rsilvergun · · Score: 3, Insightful

    This would be a complete non-issue without it. But I'm guessing tens of millions of dollars of transactions went through in that moment.

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    1. Re:Yeah for HFT! by jcr · · Score: 1

      This only affected financial reporting websites, not the exchanges themselves. I saw AAPL on google finance twenty bucks lower than I expected, so I checked my brokerage and they had the correct price.

      -jcr

      --
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    2. Re:Yeah for HFT! by F.Ultra · · Score: 1

      No it never happened that way, the problem happened after market close due to retard developers at some of the market data firms. Also the HFT firms would never source data from the system that "caused" this since the latency if far to high. The problem is that one of the aggregation systems from Nasdaq (SIP) sends out test data after market close and since the 3d of July was early close on Nasdaq this meant that the test data was sent earlier than before so devs who only looked at the timestamp instead of the market state displayed these values.

  2. AI Traders by 0100010001010011 · · Score: 1

    So all of the automatic buy/sell triggers realized this and no one dumped their stocks in a firesale, right?

    1. Re:AI Traders by Opportunist · · Score: 2, Insightful

      To sell, you need a buyer. If the stock is usually rolling around the 10 dollars mark, you will not find any idiot buying at 123,47. Likewise if it's at around 500 bucks you won't find anyone selling.

      So unless a stock was close to this price, I doubt that any buy/sell orders could be filled.

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    2. Re:AI Traders by Hentes · · Score: 2

      True, but OP was talking about automated algorithms. Wouldn't have been the first time that stop loss orders cascaded into a flash crash.

    3. Re:AI Traders by Opportunist · · Score: 1

      So a few HFTs get hosed?

      I fail to see the problem. Maybe that way they get to feel what they usually do with the rest of the world.

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    4. Re:AI Traders by Anonymous Coward · · Score: 1

      Sorry, but wrong. Most buy/sell orders are "market orders" and you are charged the going price regardless of whether or not it is unreasonable. Unless you submit a "limit order" to prevent such things from happening, you are stuck.

    5. Re:AI Traders by Actually,+I+do+RTFA · · Score: 2

      You'll find stop loss orders selling.

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    6. Re:AI Traders by Anonymous Coward · · Score: 1

      HFTers never get hosed. They are a privileged elite and any erroneous trades would be rolled back. HFTs are the exchanges bread and butter, they don't want to upset them in any way.

    7. Re:AI Traders by Paradise+Pete · · Score: 1

      Most buy/sell orders are "market orders"

      I doubt that's true even during normal hours, but it's certainly not true outside of them. Plus this wasn't even a market problem, but rather an information problem. The market prices were not affected.

    8. Re:AI Traders by F.Ultra · · Score: 1

      These prices where never distributed on systems where HFT source their data (the latency is to high) and it also happened after market close so there where no where to perform the trades anyway.

  3. Unfortunately by Big+Hairy+Ian · · Score: 2

    It's easily done if you haven't gone to great pains to isolate your test environment.

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    1. Re:Unfortunately by JustNiz · · Score: 1

      Not really. You just dont use any production systems at all.

  4. trial run by turkeydance · · Score: 4, Funny

    instead of WannaCry, WannaBuy?

  5. Re:More likely explanation? by Anonymous Coward · · Score: 1

    It was the Russians, obviously.

  6. The glitch is obvious... by __aaclcg7560 · · Score: 4, Funny

    It should have been $123.45. But someone got greedy and added two cents.

    1. Re:The glitch is obvious... by anegg · · Score: 5, Funny

      That was the other test engineer - he had to put his $0.02 in.

    2. Re:The glitch is obvious... by K.+S.+Kyosuke · · Score: 1

      Or, it was Geordi and he just *had* to fix it to 47.

      --
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    3. Re:The glitch is obvious... by Paradise+Pete · · Score: 1

      Stocks trade in values more significant than a penny. How does the poster or the article not realize this.

      Perhaps he is not privy to your personal fantasy world where that's true. How do you not realize this?

    4. Re:The glitch is obvious... by fisted · · Score: 1

      It doesn't compile, you cannot use on floating point types.
      But it's okay. If you fixed that, it wouldn't link, because wtf is println.
      Fine, though, if you fixed that, it would only break conventions because all caps are usually reserved for macros (and, for some reason, FILE).

      So overall, the output is likely a ton of diagnostics.

      EDIT(*): I realize now it was a joke. Never mind.

      (*) Finally! Thank you so much, /.! This must be some sort of record for the longest-wanted feature on a website that was eventually actually implemented. What I don't get is why it's so subtle and in such an odd position. How about just making it another button next to those that are already there? Is this some sort of UX joke?

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    5. Re:The glitch is obvious... by F.Ultra · · Score: 1

      No they are not. Stocks priced at 1 USD and above are traded at two decimals an stocks with a price below 1 USD are traded at four decimals.

  7. Missing Parts of the Story by WindowsStar · · Score: 2

    Soooo missing a big part of the story....so if someone bought a lot of Google or Apple stock at $123.47 and the price goes back to what it really was, do they get the keep the stock at the correct price? The person bought in good faith, and provided real money to do so, and we have to have FULL confidence in the way stock is purchased or the whole system collapses. If someone bought stock at the wrong price unknowingly, the people that posted the wrong price need to be responsible for posting the wrong price and make good. I watch stocks closely and when I see a large dip I buy, it would really piss me off if they came back to me and said "opps we posted test pricing, so your purchases are invalid" no, you posted wrong prices you are responsible to make good on that.

    1. Re:Missing Parts of the Story by FlyHelicopters · · Score: 3, Informative

      Wrong prices get posted all the time, companies cancel orders for it every day, it is legal...

    2. Re:Missing Parts of the Story by tlhIngan · · Score: 1

      Soooo missing a big part of the story....so if someone bought a lot of Google or Apple stock at $123.47 and the price goes back to what it really was, do they get the keep the stock at the correct price? The person bought in good faith, and provided real money to do so, and we have to have FULL confidence in the way stock is purchased or the whole system collapses. If someone bought stock at the wrong price unknowingly, the people that posted the wrong price need to be responsible for posting the wrong price and make good. I watch stocks closely and when I see a large dip I buy, it would really piss me off if they came back to me and said "opps we posted test pricing, so your purchases are invalid" no, you posted wrong prices you are responsible to make good on that.

      A stock exchange is a marketplace. It's a place where buyers and sellers gather. For you to sell a stock, someone has to buy it. And for you to buy a stock, someone has to sell it to you.

      The price you see quoted is the "last trade" price - the price at which the buyer and seller agreed to trade stocks. There are two more prices - the "buy" and "sell" prices - the "buy" price is what the highest bidder is willing to pay, while the "sell" price is the lowest price a seller is willing to sell for.

      When you trade, you may find your trade partially completed - that is, the seller only has 100 stock to sell, but you wanted to buy 200. In which case, most exchanges will complete the order for 100 stock and put you back in the buyer's queue for the remaining stock. (When you buy stock, you can put in a price and a duration for how long you're willing to offer to buy at that price. Likewise when you sell, you put in a price and a duration on how long you want to offer it for sale at that price).

      If you want to play around, Steam is the best place because the trading system works exactly like a small scale stock market.

      And if you need more examples - it's why news media reports about "oh look, hard to get item is on eBay for 10 times retail price" are completely meaningless - with stocks, just like with collectibles or hard to find stuff, you can ask whatever price you want. The real measure is whether the item SELLS at that price. If you ask 10 times retail price, and no one buys it, it's meaningless. You're just a chump trying to sell something and no one is buying.

      The only thing with the stock market is that people can put stop-loss orders in which basically says if a stock suddenly goes down in value, to just sell it at whatever price you get for them, so basically whatever price the buyers will pay. But that's if they reacted and put in sell orders for that price. Buyers who see the low price and put in bids may not get them because none of the sellers are willing to sell at that price.

  8. Salami code by Comboman · · Score: 1

    Maybe the code being tested was a Salami Slicing exploit and the programming had just watched Superman III (but not Office Space).

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  9. you have your stock at that price with ful tarder by Joe_Dragon · · Score: 1

    you have your stock at that price with full manual trader fees added to the order

  10. I almost lost it for a minute... by Ramley · · Score: 1

    I saw this when I went to Google Finance to check my stocks yesterday after the market close. I own and/or follow several of the affected stocks.

    At first I thought "Whaaaat?!?!?" Amazon lost 87% in one day!? Cisco down 14%? Apple way down, Microsoft up 5_ (something) points... so obviously it seemed fishy, but still small panic... So I went to Yahoo finance, same things. Uh oh!

    I then began searching for new on the NASDAQ and didn't find anything relevant to a tech shakeup or any stocks that got killed on the same day, so I looked for other stock price sources, and saw the real prices. My heart stopped racing and went about my day.

  11. Re: More likely explanation? by Anonymous Coward · · Score: 1

    No because any trades against this price would be cancelled anyway.

  12. Re: More likely explanation? by Anonymous Coward · · Score: 1

    Learn about T+3 settlement and you'll see why that wouldn't work.

  13. Re: More likely explanation? by Anonymous Coward · · Score: 1

    Can't you sell them at the normal price before it's canceled, withdraw as cash, and skidaddle?

    No. All trades have to clear. While your account may immediately reflect the transaction, until it clears you can't actually take the money.

  14. Comment by WallyL · · Score: 1

    47 strikes again!

  15. Re:Wrong SQL Query by F.Ultra · · Score: 1

    It's actually even worse. The system in question (SIP) is an aggregation system from Nasdaq which aggregates orders and trades into stock quotes for people and companies that don't want to subscribe to the whole data flow just to get a nice stock quote once in a while. Which is why this to begin with only affected web sites and never any trades or HFT firms.

    This system usually sends out test data after market close for various reasons. On the 3d of July the Nasdaq had an early close due to the 4th of July holiday so the test data sent this day where sent earlier than it usually is.

    Now this should of course not be a problem because the system have so called market states, i.e you know when the market opens, when it closes. So if you are an average skilled developer you know that if you receive data after CLOSE then you discard it as test data until you get the OPEN the next trading day.

    Now enter the not so average developers who instead rely on the timetstamp of the data in order to determine if the market is open or closed and you "accidentally" send out the test data as real data to various web sites.

    This is why only some 3d party firms where affected and not everyone, only the ones with retard developers.

  16. Re: More likely explanation? by Paradise+Pete · · Score: 1

    Do the trades "clear" in the same way that checks "clear"? In other words, is there literally no point in time when you can be 100% sure that the transaction won't be reversed on you like with checks?

    100% I don't know, but it's got to be high 99s.