Highlights

  • Japan's Jitters with $711 Billion Blunder
  • Samsung Sec's $140 Billion Slip Up

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Top 5 'fat-finger' trades that rocked global markets

A fat-finger trade is an erroneous trade that happens due to pressing a wrong key on the keyboard or a mouse misclick.

Keto, GM or anything diet will not reduce the losses that arise from having a fat finger! Erroneous trades or infamously labelled fat-finger trades have over the decades rocked financial markets and reminded traders - to err is human!

Japan's Jitters with $711 Billion Blunder
2014: In what could have been one of the most expensive fat-finger trades ever. Someone placed more than 40 erroneous orders in some of Asia’s largest corporations, representing hundreds of billions of dollars of business. Orders included a request for 1.9 billion shares in Toyota, around 57 per cent of its total share capital. Though no real losses were accounted for as the trades were cancelled - the total value of the cancelled trade was greater than the economy of Sweden.

Also read/watch | This EdTech startup shuts its operation, fires all the employees

Samsung Sec's $140 Billion Slip Up
2018: An employee at one of South Korea's largest brokerages tried to pay employees 1,000 won ($1.25) per share in dividends under a company compensation plan, but instead gave them 1,000 company shares instead, worth on paper about 112.6 trillion won ($140 billion), more than 30 times the company's market value. Things got worse when 16 employees sold the stock, spurring a rout of as much as 12 per cent in the space of minutes on April 6, the biggest decline since the global financial crisis.

Also read/watch | RBI June Monetary Policy: Repo rate to be hiked? All you need to know

Deutsche's $6 Billion Debacle
2019: The German bank accidentally transferred $6bn to a hedge fund client in 2015 after a junior trader on its foreign exchange desk mistakenly put through the trade. Even though the trade was reversed it left unbilled damage to the bank's goodwill.

Mizuho’s Mess Up Cost Millions
2005: The brokerage arm of Mizuho accidentally offered to sell 610,000 shares of recruitment company J-Com at one yen, instead of the intended one share at 610,000 yen. Mizuho was forced to pay 912,000 yen a share to investors who bought shares of J-Com, suffering a loss of $335 million, as part of an emergency settlement plan.

Also read/watch | Explained: What is a fat finger trade and how it can make you lose crores!

Gold's No Haven
2017: Gold traders have rattled in June by a huge spike in volume in New York futures when trading jumped to 1.8 million ounces of gold in just a minute, an amount bigger than the gold reserves of Finland. Only possible explanation: a mistaken trade of 18,149 lots of a futures contract, about 100 times the size of a typical trade of 18,149 ounces.

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