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On June 3, a data glitch caused the global conglomerate’s shares to fall from a closing price of more than $620,000 to $185 a share. The drop meant shares of Warren Buffett’s company fell by more than 99%.
This means that for traders who bought just $925 worth of shares at the bottom, their investment is now worth more than $3 million.
It’s not clear how many people bought Class A shares during the technical error, which lasted about an hour and a half, but the New York Stock Exchange (NYSE) quickly canceled the transactions.
In an update issued at 9pm last night, the New York Stock Exchange announced that it would “crack down” on all “erroneous” trades in Berkshire Hathaway stock below $603,718.30 per share.
The exchange added that the issue was related to a problem with the Consolidated Tape Association (CTA), which provides real-time information on quotes and transactions on the exchange. The CTA oversees the part of the Securities Information Processors (SIPs) that consolidates all secured buy/sell quotes and transactions into a single data stream.
The CTA said it was experiencing pricing issues that “may be related to a new software release” for SIP. As a result, the CTA has reverted to an earlier version of the software. The CTA did not immediately respond to a request for comment. Fortune Request for Comments.
The NYSE will halt certain trading during the selloff to determine which trades were in error and will be reversed, the company said, adding that the technical issues have been resolved and all tickers are trading normally.
Traders who did not jump on the discounted Berkshire Hathaway shares but instead bought heavily discounted shares of other brands are also subject to having their trades reversed, but the decision cannot be appealed.
Other stocks affected include American restaurant chain Chipotle (CMG), mining company Barrack Gold Corporation (GOLD) and meme stock darling GameStop (GME).
The good news for Berkshire Hathaway is that its Class B shares (BRK.B) were unaffected by the ticker issue, while its Class A shares closed at just over $631,000 a share.
Berkshire Hathaway did not immediately respond. Fortune Request for Comments.
A costly mistake
The Berkshire Hathaway mega-bargain is one of many failures experienced by various international stock exchanges and likely will not be the last.
Last week, live data for the S&P 500 and Dow Jones Industrial Average disappeared from traders’ screens for about an hour. Financial Times The system has reportedly since returned to normal, but the cause of the outage is under investigation.
While the New York Stock Exchange’s problems were resolved with minimal impact, the same cannot be said for the London Stock Exchange incident, which cost Wall Street giant Citigroup tens of millions of dollars.
In May 2022, traders in London created a basket worth $444 billion, ignoring hundreds of warning notices.
While Citi’s internal control system blocked $255 billion in transactions, $189 billion worth of funds still was released into global markets.
A total of $1.4 billion worth of shares were sold on various European exchanges before traders canceled their orders. Citi was fined nearly $70 million by the U.K.’s Financial Conduct Authority for this and related matters.
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