The Free Market in Automated Options Trading

Will Goldman get relief denied to Knight Capital? ¬†That’s a big concern as the firm, not all that great at automation, finds itself in a bit of a mess:

[Computers] at Goldman Sachs responsible for trading options whose symbols start with the letters H through L traded a bunch of options at the wrong prices and put Goldman out by a hundred million dollars or so. [V]arious exchanges are sitting down and pondering whether to give Goldman that money back.

Turns out that the rules for a “free market” can get pretty complicated.

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