Report looking at systemic risk arising from computer based trading and connections to the empirical literature on risk.
Systemic risk arising from computer based trading and connections to the empirical literature on systemic risk (DR29)
Ref: BIS/12/1062 PDF, 226KB, 19 pages
This file may not be suitable for users of assistive technology. Request an accessible format.
If you use assistive technology (such as a screen reader) and need a version of this document in a more accessible format, please email email@example.com. Please tell us what format you need. It will help us if you say what assistive technology you use.
Financial markets have evolved to become complex adaptive systems which rely on the high communication speeds and processing power of digital systems. Their failure could cause severe disruption to financial services and possibly the wider economy.
This report provides links between the literature on systemic risk and computer-based trading and makes proposals as to how we might develop a more unified approach to systemic risk research.
This review was commissioned as part of the Foresight project on the future of computer trading.