The Nasdaq's Robert Greifeld Responds To Thursday's Trading Halt
The Nasdaq had a bit of a problem yesterday.
"We knew professional traders had access to individual data feeds, but the traditional long investor, retail investor now didn't have the same information, because of that, we halted the market," said Greifeld.
The Nasdaq has an uptime that's near 100 percent, but with large investments made into their system, Greifeld said, they need to get better at "defensive driving."
"So the systems are able to operate by themselves, and this system [has] been in operation for 20 years. Defensive driving means 'What do you do when a other part of the ecosystem, another player has some bad event that triggers something in your system?'," said Greifeld.
He said that it was their responsibility to deal with the situation.
"We have to focus on the operational aspects of the problem while the problem is transpiring," said Greifeld.
According to Greifeld, as they went through trying to fix the error, they had lines of constant communication open with the UTP committee, all of the other exchanges, and then the industry body, the Securities Industry and Financial Markets Association, starting in afternoon.
"Our fellow exchanges, our costumers, had open lines into us," said Greifeld.
In addition, they sent out 22 head trader alerts to the entire professional community, he said.
"The people directly involved with the problem, those people who had the stake in the game of the moment, who had to do things themselves to respond to it, we were in constant communication with them," said Greifeld.
"Right? Were we on the TV at the time? No."
Obviously, no trading could happen during the halt, so no actual trading issues occurred due to the error. When they came back to start up the trading day, they did it as a completely even playing field, Greifeld said.
Greifeld went on to say that the Nasdaq aspires to perfection, aiming at 100 percent up-time.
"I can never commit to anybody that there will never be a problem. [What] we have to commit to is we're going to work as hard as we can to get to 100 percent, and to the extent we can't, we can't achieve perfection, and there's an issue, then we have the proper procedures in place to respond to it," said Greifeld.
"And that's what we did yesterday. We took our time understanding what the problem was, we resolved the problem, then we coordinated with the industry and came back in a logical, organized way. And we're quite proud of the fact that we had an orderly market close to the balance of the day."
At the time of this writing, Jason Cunningham had no position with the mentioned entities.
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