The business conduct committees of the New York Mercantile Exchange, the Chicago Board of Trade, and the Chicago Mercantile Exchange fined and suspended multiple traders and firms for trade practice violations.
The CFTC approved a new functionality proposed by ICE Futures U.S., Inc. called "Passive Order Protection," which is designed to reduce the impact of latency advantages among higher-speed traders by implementing an asymmetric delay.
Energy Metro Desk Editor John Sodergreen described the emerging debate over the CFTC's proposed Regulation Automated Trading, particularly where it concerns proposed access to source code without a subpoena.
Participants at a CFTC roundtable debated numerous elements of proposed Regulation Automated Trading. Commissioners clashed on the scope of government demands for information and the urgency to complete and implement the regulation.
Three professors analyzed granular data to explore the causes of the 2010 "Flash Crash." They concluded that the crash was caused by "prevailing market conditions combined with the introduction of a large equity sell order implemented in a particularly dislocating manner."
The National Cattlemen's Beef Association urged the Chicago Mercantile Exchange Group to consider recommendations to reduce volatility in the market caused primarily by high frequency trading. The recommendations are intended to provide Association members with "the confidence to continue utilizing CME Group livestock futures contracts as a risk management tool."
In a Streetwise Professor blog post titled "Spoof Me Once, Shame on You: Spoof Me Twice, Shame on Me," University of Houston finance professor Craig Pirrong asserted that "the very nature of spoofing - which involves doing things that are intended to be detected - makes it vulnerable to detection and countermeasures." In contending that high-frequency trading ("HFT") firms are able to detect spoofers, Professor Pirrong stated that spoofing "is a pathogen that found a niche, but the hosts' immune systems are adapting, and it will become less dangerous in short order."
In a settlement with an alternative trading system, the SEC announced that a tech group and its affiliate agreed to pay $20.3 million to settle charges that it operated a secret trading desk and misused the confidential trading information of dark pool subscribers. An SEC investigation found that...
The CME Group exchanges announced a disciplinary action against an individual member for spoofing. Spoofing is a violation of CME Rule 432 ("General Offenses"). CME Group found that the individual member entered large orders in the Ultra T-Bond, 30-Year Bond, 10-Year Note and 5-Year Note futures...
