After a glitch in trading software wiped out $440 million of its capital on Wednesday, Knight Capital Group Inc. has approached JPMorgan Chase for financing. The software has been removed, according to Knight, but not before it sent several “erroneous orders in NYSE-listed securities into the market.” Technology glitches, such as Facebook’s botched IPO in May, are occurring more frequently and wreaking havoc with investors’ confidence. “We’ve been so focused on automated throughput of orders and high-volume execution with no human intervention that we have lost the human logic factor when things go wrong,” said Joe Anastasio, founding partner of Capco. The U.S. Securities and Exchange Commission and the Financial Industry Regulatory Authority are investigating Knight’s trading error, according to William Brodsky, CEO of CBOE Holdings Inc.
Knight seeks financing after $440 million loss; shares plunge (Reuters)
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