Which of the following preceded the October 1987 crash?
A)program trading
B)stop orders
C)falling futures prices
D)All of the above are correct.

Question

Quizplus · Accepted Answer

The October 1987 crash was preceded by all of the above factors. Program trading, which involves the use of computer algorithms to execute trades automatically, was widely used by institutional investors at the time and exacerbated market volatility. Stop orders, which are orders to sell a security once it reaches a certain price, also contributed to the rapid decline in prices. Falling futures prices added to the negative sentiment in the markets, ultimately leading to the crash.

Which of the Following Preceded the October 1987 Crash