Source: Zhitong Finance "Since 1950, the S&P 500 index has risen more than 10% 21 times as of the end of May. In about 90% of these cases, the S&P 500 index rose for the rest of the year. There were only two instances of declines for the rest of the year, in 1987 (-13%) and 1986 (-0.1%)." With the rebound of the stock market, the old adage "Sell in May and Go Away" seems to have been a bad advice once again. Last month, the S&P 500 index rose 4.8%, the best May performance since 2009. The NASDAQ 100 index rose nearly 6.2%, and the NASDAQ Composite Index rose 6.9%. Goldman Sachs FICC & Equities Trading Division said: "History doesn't really support this saying. Don't sell, leave the market (go on vacation), and enjoy the good times." The rising trend is still to be continued? If history is any guide, it may indicate that the rise of the stock market is not over yet. Looking ahead to the rest of 2024, Scott Rubner, Managing Director of the Goldman Sachs Global Markets Division and tactical expert, pointed out the following historical background for investors. Rubner stated that the S&P 500 index has risen 10.7% year-to-date, and since 1950, the S&P 500 index has risen more than 10% 21 times as of the end of May. In about 90% of these cases, the S&P 500 index rose for the rest of the year. There were only two instances of declines for the rest of the year, in 1987 (-13%) and 1986 (-0.1%). "Since 1950, the median return of the last 7 months of each year (June 1 to December 31) is 5.4%. In the aforementioned 21 cases, the average performance of the last 7 months increased to 8.1%." Rubner added. Rubner also pointed out that the NASDAQ index has risen for 16 consecutive Julys, with an average return of about 4.64%.

On June 3, 2024, the US stock market played a huge joke. Shortly after the opening, the A-class stock of the big company known for its stable investment and outstanding performance, led by investment guru Warren Buffett, suddenly plummeted, plummeting an astonishing 99.97%, and the stock price dropped from around 620,000 US dollars per share to 185.1 US dollars in an instant. All investors were shocked and began to check their trading software and network connections. The financial world was in an uproar. Was it a technical error? Was it a hacker attack? Was it a fat finger trade? Was it manipulated by insiders? Other stocks were also affected besides Berkshire Hathaway A shares. According to the Consolidated Tape Association (CTA), dozens of stocks were affected. Other well-known stocks involved include Can and electrical utilities companies. In addition, the decline of Nikkei/yen, Barrick Gold and other stocks was also around 98%. Did these savvy investors strike it rich? The answer is no.$Berkshire Hathaway-A (BRK.A.US)$/$Berkshire Hathaway-B (BRK.B.US)$Instantly, the A-class stock of the big company known for its stable investment and outstanding performance, led by investment guru Warren Buffett, plummeted an astonishing 99.97%, and the stock price dropped from around 620,000 US dollars per share to 185.1 US dollars. All investors were shocked and began to check their trading software and network connections. Other stocks were also affected. Dozens of stocks were affected in total. Other well-known stocks involved include Can, Barrick Gold and electrical utilities companies.

Berkshire Hathaway's Class A shares are one of the highest-priced stocks on Wall Street and a symbol of stability and wealth in the hearts of global investors. However, according to the book value, the market value of $1 trillion evaporated into thin air, leaving only $260 million.

Please use your Futubull account to access the feature.

Other stocks were also affected besides Berkshire Hathaway A shares. According to the Consolidated Tape Association (CTA), dozens of stocks were affected. Other well-known stocks involved include Can and electrical utilities companies.$Barrick Gold (GOLD.US)$Other well-known stocks involved include Barrick Gold and electrical utilities companies.$NuScale Power (SMR.US)$In addition, Nikkei/yen, Barrick Gold and other stocks experienced a decline of around 98%.$Bank of Montreal (BMO.US)$In addition, the decline of Nikkei/yen, Barrick Gold and other stocks was also around 98%.

In the chaos, sharp traders smelled the scent of opportunity. If this plunging was just a technical error, then the stock price would quickly rebound, which means huge profit margins.

Soon, the New York Stock Exchange issued an emergency statement, saying that the failure of the limit-up and limit-down board mechanism CTA SIP caused the malfunction this time. Shortly afterwards, the NYSE updated the statement, saying that the problem of abnormal stock quoting had been fixed, and the affected stocks had reopened or were reopening.

But the trading records showed that 46 shares were even traded at $185.1.

Did these savvy investors strike it rich? The answer is no.

The New York Stock Exchange soon realized that this was the core issue of investor concern. While investigating this technical failure, it also wrote in an email that "all erroneous trades due to technical problems will be canceled" and announced that all price abnormal trades of Berkshire Hathaway would be invalidated during a specific time period.

As the problem was solved, the market gradually returned to normal, and the stock price of Berkshire Hathaway also returned to its rightful level. The traders who had completed the transactions that had been declared invalid, although eventually invalidated, had taken actions that were still a new legend on Wall Street, which made people talk about it because in the financial market, accidents could happen at any time. Those who could react quickly and seize opportunities would often gain unexpected returns.

Mizuho Securities' wrong index finger, some people earned 2 billion yen

December 8, 2005, Tokyo, Japan. It was supposed to be an ordinary trading day when a trader at Mizuho Securities received an instruction to sell the shares of a company called J-Com, which had just listed on the first day.

The trader sat in front of the computer, and his fingers flew over the keyboard, ready to enter the sell command. However, a tiny mistake caused a financial storm. He was supposed to enter "sell 1 share at a price of 610,000 yen", but mistakenly entered "sell 610,000 shares at a price of 1 yen".

This instruction was immediately sent to the Tokyo Stock Exchange, causing the market to plunge into chaos. J-Com's stock price plummeted from the normal price to almost zero, and this incorrect instruction from Mizuho Securities led to panic selling by other investors on the market. Within a short 30 minutes, this incorrect instruction caused Mizuho about 40 billion yen (approximately US$390 million) in losses, and their full-year profit was reduced to zero.

61,000 sell orders, a quantity that was even 42 times the number of J-com's circulating shares! When this order was placed, it was immediately noticed by the intraday trading tycoons and some institutional investors in the market. One investor named "CIS" quickly grabbed 3,300 shares on the limit down board, which was 25% of the actual trading volume, and ultimately made a profit of 600 million yen.

Interestingly, this "CIS" also cooperated with Kadokawa Corporation, one of Japan's largest publishers in 2018, and shared his investment ideas. The book is entitled "The Investment Philosophy of Man Who Can Single-Handedly Move the Nikkei".

In this incident, the most famous person is not CIS, but the "God of Stock" BNF, who used to be active on the 2ch forum in Japan and disappeared amidst the curse of investors later. At the moment of the incident, BNF's hands were faster, funds were larger, and he grabbed more, finally earning over 2 billion yen, more than three times that of CIS. It wasn't until some of the stocks were settled in cash after the false order incident that the real names of these investors were displayed on the public screen, and people came to know that BNF's real name is Takashi Kotegawa.

At the moment of the incident, BNF's hands were faster, funds were larger, and he grabbed more, finally earning over 2 billion yen, more than three times that of CIS. It wasn't until some of the stocks were settled in cash after the false order incident that the real names of these investors were displayed on the public screen, and people came to know that BNF's real name is Takashi Kotegawa.

Who will clean up the mess in exchange operation?

The technical stability of the exchange is crucial to maintaining market order and protecting investors' interests. In the Mizuho Securities false order incident, the trading system of the Tokyo Stock Exchange had a defect that prevented the revocation of the order, thus being the key party responsible for this event. Specifically, when Mizuho Securities became aware of the error and attempted to cancel the trade, the TSE system did not recognize the cancellation instruction, and the TSE stated that it did not have the authority to unilaterally cancel a specific transaction, and must be reported in accordance with the prescribed procedure. The Tokyo District Court ruled that the TSE’s trading system had a defect, and had a significant fault for not stopping the transaction in the face of obvious abnormal transactions. The court ruled that the TSE should bear 70% of the responsibility and compensate Mizuho Securities for 10.7 billion yen.

The case between Mizuho Securities and the TSE eventually went to the Tokyo High Court. The Tokyo High Court upheld the first-instance ruling. In the end, Mizuho Securities acknowledged its mistake, while the Tokyo Stock Exchange not only had to pay compensation, but also had to spend a huge amount of money to improve the trading system.

The case between Mizuho Securities and the Tokyo Stock Exchange was eventually escalated to the Tokyo High Court, which upheld the first-instance judgment on appeal. Eventually, Mizuho admitted its mistake, while the Tokyo Stock Exchange had to spend a huge amount of money to improve its trading system, in addition to paying compensation.

In this incident, the most famous person is not CIS, but the "God of Stock" BNF, who used to be active on the 2ch forum in Japan and disappeared amidst the curse of investors later. At the moment of the incident, BNF's hands were faster, funds were larger, and he grabbed more, finally earning over 2 billion yen, more than three times that of CIS. It wasn't until some of the stocks were settled in cash after the false order incident that the real names of these investors were displayed on the public screen, and people came to know that BNF's real name is Takashi Kotegawa.

Who will clean up the mess of exchanges' operations?

Editor/tolk