In modern finance, a flash crash is a very rapid, deep, and volatile fall in security prices occurring within a very short time period followed by a quick recovery.[1] Flash crashes are frequently blamed by media on trades executed by black-box trading, combined with high-frequency trading, whose speed and interconnectedness can result in the loss and recovery of billions of dollars in a matter of minutes and seconds, but in reality occur because almost all participants have pulled their liquidity and temporarily paused their trading in the face of a sudden increase in risk.[2] Occurrences Examples of flash crashes that have occurred: May 6, 2010, flash crash April 23, 2013, flash crash Frankenshock,[3] or Flash Crash Swiss Franc on January 15, 2015[4] Flash Crash of the British Pound on October 6, 2016[5] Flash Crash of Japanese Yen on January 2, 2019[6][7] Flash Crash of European Stock Markets on May 2, 2022.[8][9] 2010 flash crash Main article: 2010 flash crash This type of ...
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