"I should have asked if they have some security catch to prevent fraudulent trades that kicks in when a security moves too far up and down (or vice versa) too fast. But I didn't think of that at the time."
That's a very good theory. There has been some fraud issues recently where hackers get access to somebodies account and use it to make bogus trades that they take the other side of.
Certainly the pattern of a very isolated volume/price spike would be a good trigger. If I was the person tasked with looking at this, I would pull the alarm switch, at which point no more online trading would be the obvious action.
As a follow up, the question is "Was the spike (and the exceptional bid the day before) fraud or not?"
I am sceptical that the action was due to leaked news, because of lack of followup.
I did consider the possibility of a margin call on somebody who had 300k IDIX short. This would explain the patient attempt to buy (while the customer tried to buy back), followed by the quick buy in when the broker said "times up".
But a fraudulent trade makes equally good since.
[BTW, for those who don't do margin. A margin call applies to an account, not just a stock (like most mb poster kiddies imply). Thus a margin call related sell/buy does not need to be related to a stock that has moved significantly].
AI
