Wrong key pressed, Rs 200-250 crore may have been lost in one of India’s biggest trading mistakes

A broker may have lost a massive sum to the tune of Rs 200-250 crore after a ‘fat finger’ trade was registered on the National Stock Exchange's (NSE) derivatives segment on Thursday. This mistake in trading could be one of the biggest in the history of the Indian stock markets. The NSE also alerted the traders against such errors after the news came to light.

Stock brokers were warned by the NSE against executing orders that appear to be non-genuine, leading to deviation in the normal price discovery process. A ‘fat finger’ trade is a term in market lingo for transactions that happen by mistake due to a wrong key being pressed.

The incident brought back memories of the 2012 fat finger trade that caused a Rs 60 crore loss to Emkay Global Trader and also lead to a nearly 15 percent dip in Nifty index. The trader who input the mistaken trade is Vardhaman Global Sharecom who had also written to NSE to look into its error, as per a report during the weekend.   

The NSE asked traders to strictly abstain from inputting or executing trades on their own account or on behalf of their clients that prima facie appear to be non-genuine. Traders have been told to avoid practice which can result in aberrations in the order book.

NSE noted instances where orders have been placed by few traders on its exchange which are not reflective of the current market price and are far away from last traded price. “Non-compliance of the circular shall attract suitable disciplinary action...Which may include deviation from the trading terminals,” NSE circular said.

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(With inputs from PTI)