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It specifically points to high frequency trading, an automated trading platform that can run a large number of orders at the speed of lightning.
Goody's comments echo those of Jim Cramer of CNBC, who said Wednesday that the quick sale should have been sought by Wall Street regulators.
"When stocks fell in free fall at low volume on Christmas Eve, it should have spurred trade officials, perhaps [the] Treasury [Department], [the] SEC, to ask what happened, "he said in" Mad Money ".
The SEC did not immediately respond to a request for comment.
Goody believes that volatility erodes investor confidence in the stock market.
"Once there is a mbadive sale, you have the opportunity for people who are in the market, such as high-frequency traders, to go out early, and then when the market starts to appear, buy low." However, ordinary investors are losing more money because they can not act so quickly, she added.
And that's exactly what happened on December 24, Goody said.
"Automated algorithms … launch a mbadive sale, then investors hear that and start selling, then stop-loss orders come into play," she said. "It's all this automated technology that we have not really followed."
– Elizabeth Gurdus of CNBC contributed to this report.
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