Mysterious and possibly nefarious trading algorithms are operating every minute of every day in American stock exchanges.
The
trading bots visualized in the stock charts in this story aren’t doing
anything that could be construed to help the market. Unknown entities
for unknown reasons are sending thousands of orders a second through the
electronic stock exchanges with no intent to actually trade. Often, the
buy or sell prices that they are offering are so far from the market
price that there’s no way they’d ever be part of a trade. The bots
sketch out odd patterns with their orders, leaving patterns in the data
that are largely invisible to market participants.
“We probably get 10 stocks in any 10 minutes where we see something like this,” Donovan said. “It’s happening all the time.”