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SSC asks to prevent stock trading bots. |
Through supervision of online stock trading service provision activities, the State Securities Commission found that traders have been using robot technology to place automatic online stock trading orders with great frequency. This activity has many potential risks and affects the stability of the stock market.
In its latest announcement, the State Securities Commission requested securities companies to review and immediately stop traders from automatic order placement.
At the same time, these companies must adopt technical measures to prevent stock automatic order placement and require investors to stop using this form without permission of the responsible agency. Stock trading bots allow stock traders to buy, sell, and trade stocks and other securities automatically using a bot that executes trades automatically based on a specific trading strategy to automate profits.
According to the State Securities Commission, the phenomenon of using robot technology to automatically place online stock trading orders has many potential risks and affects the stability of the stock market.
Specifically, automatic order placement causes a sudden increase in orders in the portal of the Stock Exchange at the same time, leading to the number of orders entering the floor exceeding the design capacity of the system, causing problems of system overload. Moreover, this activity leads to the risk of chain breakdown when the market goes bad; thereby negatively impacting the risk management of securities companies.
Accordingly, the State Securities Commission required securities companies to seriously implement and take full responsibility before the law for the above issues.
