Computer trading, humans are both to blame for market sell-off: NYSE President

NYSE President Tom Farley on Monday said algorithmic trading is only a part of what’s to blame for the massive market sell-off and that investors need to remain “calm.”

“It’s always a combination of humans, humans’ judgement and emotion, as well as machines that have been programmed to behave in a certain way," he said.

Some investors believe that the massive market sell-off was due to algorithmic trading, which gives investors the ability to pull out of the market at an accelerated rate. Many analysts blamed the Dow’s 1,175-point loss last Monday from the influx of computer trading.

“I don’t think today’s modern trading is any different than yesterday’s or 20, or 50 years ago,” Farley said.

This year’s worst trading day for the Dow came last Monday, when it fell by 4.6%, which is also the index’s largest percentage drop since August 2011.

“On Monday, the Dow was 24,300, on Thursday it was 23,800 and you could have in a panic sold everything you had. Now it’s right back up above either one of those place. So my advice has just been calm down, relax, the underlying economy is good, the stock market has been very good. In fact, it’s still up 14%, the Dow Jones, since the night of the election,” he said.

Since Friday, the Dow has continued to bounce back following the sell-off, which left investors in a panic. The Dow ended Monday up 410 points, closing at 24,601.

The NYSE president also advised investors to make long-term decisions and not to let the media impact their investment choices.

“I’ve been saying the same message: Markets go up, markets go down, and that’s what they do. Investors should make long-term decisions, not day-by-day decisions, based on what they are seeing on TV or the particular movements in the stock market for that day,” he told FOX Business’ Melissa Francis on “After the Bell.”