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How Will Exchanges Fare the Next Time Volume Spikes?

Fed interest rate decision might unleash a tsunami of volume; some question whether markets are ready.

By Nick Baker, Brian Louis, and Matthew Leising, Bloomberg | Updated on September 17, 2015

Exchanges passed two recent tests of their ability to handle an explosion of trading. They face a third and potentially greater challenge today, when the Federal Reserve decides whether to raise interest rates for the first time in nine years.

On Aug. 24, as anxiety engulfed markets worldwide and prompted one of the worst days for stocks since the aftermath of the 2008 financial crisis, no exchanges reported malfunctions. U.S. stock exchanges weathered a surge in volume to a four-year high of 14.1 billion shares. Last year, a wild session for Treasuries and other assets prompted no obvious malfunctions on Oct. 15, when 11.9 billion U.S. shares traded.

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