Wall Street & Technology is part of the Informa Tech Division of Informa PLC

This site is operated by a business or businesses owned by Informa PLC and all copyright resides with them. Informa PLC's registered office is 5 Howick Place, London SW1P 1WG. Registered in England and Wales. Number 8860726.

Trading Technology

11:20 AM
WS&T Staff
WS&T Staff
News
Connect Directly
RSS
E-Mail
50%
50%

Excerpts From Last Month’s Most-Viewed WS&T Blog Postings

Below are excerpts from last month's most-viewed WS&T blog postings. To read these and other blogs from our editors, or to add your own comments, please visit wallstreetandtech.com/blog.

Morgan Stanley and the Great $10 Billion Trade Debacle

Posted by Cory Levine

NYSE Regulation fined Morgan Stanley $300,000 for a failure to provide sufficient inhibitors and blocks within its trading system that led to a massive botched trade.

A Morgan Stanley trader attempted to unwind a portion of an existing swap, with an affiliate of the firm acting as the counterparty. To hedge its position, the affiliate took a short position in the shares of common stock underlying the basket. The mistake came about when the trader entered an order to buy 100,000 units of the basket to cover a portion of the affiliate's short position, not realizing that the tool used to create the basket had a built-in multiplier of 1,000. The result was a basket with a value of $10.8 billion instead of $10.8 million.

Reader Comment, Posted by Nick

Another feel-good story out of Morgan. What I like about them is all their problems really scale well.

A Spy in the Ernst & Young Advanced Security Center

Posted by Cory Levine

This morning I was invited to the Ernst & Young headquarters in Times Square to tour the firm's Advanced Security Center (ASC). Through the dually authenticated door locks and under the concrete-lined ceilings of the office were an impressive facility and a team of truly dedicated white hats, diligently probing the defenses of your bank or brokerage, and mine.

E&Y takes a vendor-agnostic approach to consulting its clients, focusing on best and leading practices, and thorough training in secure development techniques. Knowing that the resources of the IT organization are perpetually stretched, and that business users care only about results and not security, the ASC's assessments ferret out the security gaps that occur due to lack of human capital. Most financial firms simply do not have the resources to test their applications and infrastructure with the type of rigor that a dedicated team will afford.

Register for Wall Street & Technology Newsletters
Video
Exclusive: Inside the GETCO Execution Services Trading Floor
Exclusive: Inside the GETCO Execution Services Trading Floor
Advanced Trading takes you on an exclusive tour of the New York trading floor of GETCO Execution Services, the solutions arm of GETCO.