Black Phoenix glitch highlights PB dangers

Rabobank's decision to pull out of FX PB highlights risky nature of the business

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A rogue algorithm shook currency markets in November last year, when Black Phoenix, a Chicago-based high-frequency trading shop, suffered a technology glitch and accumulated large positions on an electronic trading platform within seconds, FX Week has learnt.

At the time, one of Black Phoenix's algos suffered a bug and ran up a large position on trading platform Integral, using up allocated credit lines before a kill switch was manually engaged. Black Phoenix's prime broker (PB), Netherlands-bas