If you take a look at the UBS quarterly report, you can read the specifics of their claim (quoted below and available in full on the UBS website). Essentially, the bank asserts that NASDAQ initiated buy requests multiple times. Had Facebook stock sky-rocketed, as anticipated, I wonder if we would have ever heard a word of this? "Due to multiple operational failures by NASDAQ, UBS’s pre-market orders were not confirme…
"Thank you for your placing an order with NASDAQ. Please do not hit the back button or refresh this page, or your order may be registered more than once."
This isn't about the support level of Facebook's share price. UBS claims that NASDAQ was de facto dysfunctional. Too many buy orders were triggered, cancellations not being fulfilled and so on.
True, but the implication was that a lot of their FB activity was executed by their traders on behalf of their (now unhappy) clients. It's my opinion that this lawsuit wouldn't be happening if FB's stock was at $50.
Ofcourse it wouldn't be happening then, nobody would have had taken any damage if the FB stock had stayed or risen.
UBS would just have sold off the excess of shares it had received, perhaps at a profit. Perhaps just warning NASDAQ of their reckless technical situation.
That doesn't mean that there for some reason this lawsuit isn't justified. NASDAQ made UBS take a risk they did not want to take.
right, specifically "to address its gross mishandling of the offering and its substantial failures to perform its duties". does anyone know what they could possibly have in mind?
There were severe technical problems in Nasdaq's trading system during the IPO: http://abcnews.go.com/blogs/business/2012/06/nasdaq-outlines...
I'd love to see during discovery that UBS has a high-frequency trading group that was partially responsible for seizing up the NASDAQ order book during the IPO.
If you take a look at the UBS quarterly report, you can read the specifics of their claim (quoted below and available in full on the UBS website). Essentially, the bank asserts that NASDAQ initiated buy requests multiple times. Had Facebook stock sky-rocketed, as anticipated, I wonder if we would have ever heard a word of this? "Due to multiple operational failures by NASDAQ, UBS’s pre-market orders were not confirme…
The order workflow is generally like so: 1) Client sends order to market. 2) Market acknowledges it has received the order, sending back the market-generated order ID. 3) The market tries to fill the order (takes from 1ms to a day, depending on the type of order). When the order is filled, the client is informed. 4) At any time before the order is filled, the client can cancel it. Perhaps during NASDAQ's issues the a…
So, shouldn't the protocol involve the client generating the order ID, so that they can cancel the order without having yet gotten confirmation of it? Or at least, the client being able to include a "client handle" for this purpose, that is independent of the order ID but which they can use to refer to it before they've gotten the ID?
The order workflow is generally like so: 1) Client sends order to market. 2) Market acknowledges it has received the order, sending back the market-generated order ID. 3) The market tries to fill the order (takes from 1ms to a day, depending on the type of order). When the order is filled, the client is informed. 4) At any time before the order is filled, the client can cancel it. Perhaps during NASDAQ's issues the a…
So, shouldn't the protocol involve the client generating the order ID, so that they can cancel the order without having yet gotten confirmation of it? Or at least, the client being able to include a "client handle" for this purpose, that is independent of the order ID but which they can use to refer to it before they've gotten the ID?
Or have it do some high level of QOS where both sides need to acknowledge that the other side received the message otherwise cancel the request. This is pretty much what TCP does.
A bank sues stock marked over some number fluctuation caused by social network and all that produces millions of profits for the lawyers :) . If I would be more naive I'd say "Let them all burn down". But since all that translates to billions of real money and can possibly harm entire countries in some cases (like the LIBOR scandal) we can only watch and wonder how did we come here...
If you take a look at the UBS quarterly report, you can read the specifics of their claim (quoted below and available in full on the UBS website). Essentially, the bank asserts that NASDAQ initiated buy requests multiple times. Had Facebook stock sky-rocketed, as anticipated, I wonder if we would have ever heard a word of this? "Due to multiple operational failures by NASDAQ, UBS’s pre-market orders were not confirme…
The order workflow is generally like so: 1) Client sends order to market. 2) Market acknowledges it has received the order, sending back the market-generated order ID. 3) The market tries to fill the order (takes from 1ms to a day, depending on the type of order). When the order is filled, the client is informed. 4) At any time before the order is filled, the client can cancel it. Perhaps during NASDAQ's issues the a…
The real problem, according to UBS, is that in absence of an acknowledgement they sent extra orders. UBS improperly acted. The first rule when you set up risk limits is to consider both actual position (acknowledged) and theoretical position (assuming all orders are filled). Standard risk controls would have prevented this.
If you take a look at the UBS quarterly report, you can read the specifics of their claim (quoted below and available in full on the UBS website). Essentially, the bank asserts that NASDAQ initiated buy requests multiple times. Had Facebook stock sky-rocketed, as anticipated, I wonder if we would have ever heard a word of this? "Due to multiple operational failures by NASDAQ, UBS’s pre-market orders were not confirme…
Shouldn't their "system protocol" have a way for the the server to recognize resends of orders it has already received, and ignore them?
You may actually want to send multiple orders, which is why pretrade duplicate checks usually assume a fixed window (2 orders of the same price/quantity/side in a 50 msec window)
For example, sending a large order to the market looks different from many smaller orders.
True, but the implication was that a lot of their FB activity was executed by their traders on behalf of their (now unhappy) clients. It's my opinion that this lawsuit wouldn't be happening if FB's stock was at $50.
Ofcourse it wouldn't be happening then, nobody would have had taken any damage if the FB stock had stayed or risen. UBS would just have sold off the excess of shares it had received, perhaps at a profit. Perhaps just warning NASDAQ of their reckless technical situation. That doesn't mean that there for some reason this lawsuit isn't justified. NASDAQ made UBS take a risk they did not want to take.
UBS was rendered an undue risk when the first order didn't acknowledge. Sending future orders was UBS mistake, despite the eventual performance.