Is it illegal to buy stocks at a low price during a flash crash using a low GTC order?
We've seen several flash crashes in the past few years, and I suspect algorithms are some of what's behind these (see this as an example). In a short period of time, an exchange will suddenly see tons of sells and fall dramatically, only to self-correct.
Using an example of the SPY, would it be legal to put in a Good-Til-Cancelled order for 0 a share and make a profit on the flash crash, if it occurs? Note that the assumption here is that it crashes in a short period of time (within a day), not over time (so the order can be re-arranged if the market declines over a period of time).
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A person executing a single order during a flash crash would not be high on the suspect list for the cause of the crash, so no, I wouldn't worry about it at all. There is nothing wrong with taking advantage of whipsawing prices as long as you didnt cause them.
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