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Regulators looking into Knight Capital's trading error: CBOE
August 2, 2012 / 1:36 PM / 5 years ago

Regulators looking into Knight Capital's trading error: CBOE

A trader works at the Knight Capital kiosk on the floor of the New York Stock Exchange August 1, 2012. REUTERS/Brendan McDermid

CHICAGO (Reuters) - U.S. regulators are looking into Knight Capital Group Inc’s trading error Wednesday that caused a rush of orders for dozens of stocks on the New York Stock Exchange, the chief of the biggest U.S. options market said.

“Our understanding is that the SEC (Securities and Exchange Commission) and FINRA are reviewing what happened yesterday,” CBOE Holdings Inc CEO and Chairman William Brodsky told analysts on Thursday. “We’re obviously reluctant to get ahead of the regulators on this ...I really think we ought to let the facts come out and then see what happens.”

Knight Capital, one of the largest firms that buys and sells stocks to provide liquidity to the markets, blamed a “technology issue” for the problem.

“It’s obvious that it appears that there was a technology glitch in the trading algorithm,” Brodsky said. “All markets have rules to address these types of situations.”

Reporting by Ann Saphir; Editing by Gerald E. McCormick

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