Yes, actually I remember that day. Transactions sent in even buys took hours and _hours_ to execute. I didn't know the final state of my fb trades until the next day.
The problem as I understood it:
(1) Consumer brokers often consolidate trades/buffer them up and send them on
(2) More centralized entities actual have access directly to the trading systems and execute these batches of trades coming in
(3) The trading system does it's magic and responds
My understanding was that (2) and (3) became _incredibly_ overwhelmed and latency spiked, queues filled, and trades took _forever_ to go through.
Unfortunately, the consumer broker is stuck at the mercy of waiting for responses from (2). So yes, they can take in customer requests, but they are not the ones that finally execute and latency can become huge.
Completely unacceptable, in my opinion. If I cancel the order, the expectation is that the order is cancelled. If it is not cancelled when I told it to cancel explicitly, then Vanguard is on the hook for that. The timestamps on the trades should be enough to illustrate what happened when.
You need to adjust your expectations. When you enter an order, your only expectation should be that it gets filled, and not necessarily quickly (or at the price you'd like unless it's a limit order). Check with your broker, I'll guess that they make no guarantee about canceling orders. Using Fidelity as an example, when I cancel an order the page comes back with "attempting to cancel order" (emphasis mine). Someone fills the order before the cancellation makes it through? You just bought yourself some stock.
In ordinary circumstances, yes this is all true. When the clusterfsck that was the Facebook IPO happens and the market shuts down for hours, no... there was time to cancel that order. If her order was sitting in a queue somewhere waiting to be executed, it should have been able to have been removed. If it wasn't, then Vanguard should have at least been able to tell her what its status was.
The problem as I understood it:
(1) Consumer brokers often consolidate trades/buffer them up and send them on
(2) More centralized entities actual have access directly to the trading systems and execute these batches of trades coming in
(3) The trading system does it's magic and responds
My understanding was that (2) and (3) became _incredibly_ overwhelmed and latency spiked, queues filled, and trades took _forever_ to go through.
Unfortunately, the consumer broker is stuck at the mercy of waiting for responses from (2). So yes, they can take in customer requests, but they are not the ones that finally execute and latency can become huge.