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Cancelled trade by stock exchange (busted trade)


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I got a few of my trades cancelled by the Frankfurt Stock Exchange due to "erroneous price".

 

The other party clearly wasn't paying attention to the company announcement. I guess that they found out afterward and contacted the exchange. The exchange ruled that the execution price was "erroneous" and had my broker cancel the trades without consulting me. Now IB is telling me there is nothing they can do. I guess under certain circumstances, a trade can be cancelled such as exchange system malfunction, etc. And I have been in the losing end of many trades when I make mistake: entering wrong price, forgetting to cancel a GTC order, especially with those illiquid penny stocks. So to me a mere mistake is not an excuse to cancel a legitimate executed trade. 

 

Did anyone here have similar experiences?

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My opinion, and it is only that, is that you were wronged by the Frankfurt exchange.

 

Short of lawyering up, I’m of sure what you can do.

 

Sometimes a strongly worded letter from a lawyer threatening legal action can produced outsized results. 
 

Might be worth a go if the money lost is sizeable.

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About 20 years ago I saw an after-hours market quote where I thought the ask was lower then the bid. Free money! I traded the stock back and forth a few times, going bigger and bigger, each time making about 1%! The bid-ask did not change, either, which got me a bit suspicious.

 

At some point my vision clicked and, although I am not dyslexic, it appears for about 15 minutes I was, mistaking $59.49 for 54.49 or something like that. Each trade I lost about 10%. By the time I was done I had lost $3000-4000, which was at the time 15-20% of everything I had.

 

Shaken to the bones, I called IB, and told them I made a mistake, LOL. (At the time I wasn't laughing). The guy told me he could try to get the trades busted, but gave me little hope it would work.

 

An hour or two later, when I checked the account, they had busted the trades. Crazy relief. And lesson learned, although I got away cheap.

 

In retrospect, they should not have busted the trades.

 

Edited by backtothebeach
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This involves a bunch of trades lasted about an hour so it's not a single mistake. The disturbing fact is that there is little transparency in the whole process. I only got an email informing the ruling without process/contact information for appeal, etc.

 

The forfeited gain was mid five figure dollar amount. So if any entrepreneur lawyer familiar with Frankfurt Exchange is interested, feel free to contact me and I'm willing to split potential profit.

 

Coincidently, I bought a very small position in PTPI last week when its price more than tripled after someone released fraudulent merger news. If you ask me this is a case that trades should be busted. When I asked my broker, they said NASDAQ decided that trades would stand.

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