For decades now, when stock markets have melted down for one reason or another, markets and regulators have created rules to keep it from happening again.
“We have a number of protections against fat-finger trades,” says James Angel, associate professor of finance at Georgetown’s McDonough school of business. Fat-finger trades are when someone just presses the wrong button. “This happens all the time — someone puts a decimal point in the wrong place or hits buy instead of sell.”
Brokers — or, more specifically, their computers — catch these sorts of things automatically.