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"Fat Finger" errors
It is the most basic mistake on the keyboard. But slightly incredibly, it seems that sterling’s sudden loss of value in Asian markets on Friday may well have been the result of mistyping into a trading system. Human input will never be error free – but a good system should be able to stop mistakes reaching live markets .
Long before last week made clear how much impact such mistakes can have, we designed four levels of protection against fat fingers into the Adaptable Blotter:
Keyboard Shortcuts: for use in inputting large numbers such as M for 1,000, or “5MM” for 5,000,000 – much easier than counting 6 zeros). Most fat finger errors occur when an extra 0 is wrongly added to a notional amount.
Cell Validation: Our sophisticated Rules Engine allows you to create any number of validation rules against the inputs you make, with the choice of triggering a warning or simply preventing the edit. A simple Cell Validation rule would have quickly prompted the trader on Friday to realise his mistake with the result that it would have been cancelled without ever being booked into market.
Plus / Minus: In volatile markets mathematical ability still makes it possible to miss a decimal place when quickly editing a value. Plus/Minus rules allow users to decide what the increment for a column should be (either for a whole column, or on a row by row basis –e.g. increment ‘BidOfferSpread’ by 0.1 when ‘Currency’ = “USD” and ‘Rating’ = “Investment Grade”). When the “+” key is pressed, the cell automatically updates according the relevant rule. This reduces the number and frequency of calculations and thereby the number of mistakes.
Instant Alerts: A trading system today needs regulatory and compliance defences built in. The Adaptable Blotter contains the most sophisticated Audit and Alert functionality built into any Blotter on the market. These guard against fat fingers as well as a range of other errors, both deliberate and accidental.
Trading systems should help users work quickly and efficiently, and also guard against their human fallibility. There’s no doubt that with an Adaptable Blotter on his desktop, the Asian trader would still be working in glorious anonymity and the sterling exchange graph would look very different.