Flash Crash: This Retail Investor DESTROYED High-Frequency Trading Bots In The Stock Market #shorts

This retail trader from the London suburbs caused a 9% market drop and made millions.

After the 2008 financial crisis, high-frequency trading emerged as a new hedge fund strategy. These traders would make millions of automated trades a day that would profit from front-running orders. At the same time, a retail investor from London named Navinder Sarao began to analyze the pattern of these high-frequency traders. He was able to reverse engineer his own automated trading bot that could profit from deceiving HFTs. One volatile day, he ran his trading strategy raking in over $950k in earnings. But when he took his profit and shut off the algorithm, the entire market crashed.

As a result of this bizarre black swan event, the SEC and Department of Justice investigated the issue and found out that Navinder was spoofing orders. The bot would place large buy orders only to cancel them and then place a sell order which deceived higher frequency trading algorithms. In the end, he wasn’t sentenced to jail time, but rather banned from trading and served a year-long house arrest.
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Keywords: Incognito Finance, Hedge fund, Bill Ackman, Carl Icahn, Flash Crash, Navinder Sarao, High-Frequency Trading, Trading Algorithm, Trading Bot, stock market, stock trading
Title: Flash Crash: This Retail Investor DESTROYED High-Frequency Trading Bots In The Stock Market #shorts #stocks #stockmarket #GME #AMC #shortsqueeze #trading #daytrading

[IncognitoFinance]

Additional context: He had amassed millions using order spoofing, but actually lost the money by investing it into uninsured savings accounts.

[Southerncyclist]

Sounds like he was doing the same thing that all the big firms where doing. He beat them at there own game so they got pissed.

[megapet]

You know you are successful trader when you are banned from trading.

[pointy]

they made the kid a scape goat. They can't sentance him. If they do they have to close all the bigfirms who actually do it on a larger scale. His 900k can not make a dent in the system. stop kidding yourselves. He was a scapegoat.

[avarmauk]

No worries Navinder, why don’t you trade under my name, we can share the profits 😂

[charlieyang]

So he's saying front running trades is legal but spoofing is not legal 😅

[knight-txzr]

You know when you are successful gambler who is banned from every casino

[hemanthk]

Why is this guys genius not appreciated ? While the hft bots are allowed to do as per their liking for their masters ..

[rockyryze]

And we traders need to learn from your videos and from these people ❤❤

[joshmoore]

Just like everyone else on wall st. Steal money with no penalty

[atharvabhosale]

So wait if firms do it that's alright but when someone else does it that's wrong? Bro what?

[keeganfisher]

Correction: he stole millions and ended up with nothing.

[jbjab]

This kid was the fall guy. He did not cause the flash crash. HFT giant firms did.

[mfahanar]

JUST BECAUSE NAVINDER ALONE THEN EVERYTHING GOES WRONG, WHAT ABOUT THE BANK ? TOTALLY UNFAIR

[raviphogat]

navinder saro was from India not from london

[CryptoBoostOfficial]

You are giving incomplete knowledge there are a lot of things you haven't told. Now please don't blame that shorts are just 60s you can give a lot of knowledge in just 60s also.