Now Investors Are Worried That a Single Trader Could Take Down the U.S. Stock Market
A trader on the floor of the New York Stock Exchange after the close on May 6, 2010. The Wall Street "flash crash" on May 6 that saw the Dow Jones index dive almost 1,000 points within minutes was sparked by a single 4.1-billion-dollar computer trade.
Photographer: Daniel Acker/BloombergThere are enough reasons to lie awake at night without having to worry that a single trader can take down the U.S. stock market from a London suburb, fund managers said.
U.S. authorities accused 36-year-old Navinder Singh Sarao on Tuesday of masterminding a five-year scheme to use phony orders in Standard & Poor’s 500 Index futures to manipulate prices and book $40 million in illicit profits. Along the way, he had a hand in erasing $862 billion from the U.S. stock market -- in a matter of minutes, they alleged.