A fat-finger error is a keyboard input error in the financial markets such as the stock market or foreign exchange market whereby an order to buy or sell is placed of far greater size than intended, for the wrong stock or contract, at the wrong price, or with any number of other input errors.
Fat Finger Error
What is ‘Fat Finger Error’
A human error caused by pressing the wrong key when using a computer to input data. Fat finger errors are often harmless but can sometimes have significant consequences for example, if the wrong number is entered in performing a mathematical calculation.
Explaining ‘Fat Finger Error’
In the aftermath of the May 6, 2010, “flash crash” that caused a significant, rapid and unexpected drop in the Dow, one possible early explanation was fat finger error. The idea was that a trader had entered an order incorrectly, placing the order in the billions rather than the millions. In reality, such trading errors are unlikely because of safeguards implemented by brokerages and exchanges.
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