Knight Glitch a Reminder: ETF Investors Should Avoid Market Orders This Week
As always, limit orders are best--especially after Sandy has wreaked havoc and the lights in New York aren't guaranteed to stay on.
Wednesday's reopening of the New York Stock Exchange--after it was closed Monday and Tuesday because of Hurricane Sandy--largely went smoothly. However, as a waterlogged northeastern United States slowly dries itself out and cleans up from the storm, power sources are shaky at best.
Even with the markets reopened, unsteady power should be a concern for exchange-traded investors. The reason? Because New Jersey-based Knight Capital (KCG), which is the largest ETF market maker, announced Wednesday that its backup power generation system had failed, leading the firm to shut down all trading and direct orders to other brokerage firms for several hours. (Knight announced Thursday that operations were back to normal, processing orders with no problems.)
Robert Goldsborough does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.