The Securities Industry Association said it has completed its first round of year 2000 testing in the hopes of insuring against computer problems that may foul up electronic trading at the turn of the millennium. The SIA claimed the tests were largely successful, if not perfect, with 90% of the transaction tests completed successfully. A spokesperson for the association insisted, however, that the 10% of transactions that failed did so largely due to problems unrelated to the Y2K issue. The real number for Y2K-related failures was less than 1%, she said. During the test, each of the 28 firms participating input about 500 trades on each of the testing days, for an average of 10,000 a day. A complete four-day cycle was simulated, with December 29, 1999 simulated on July 13; December 30 on July 15; December 31 on July 20; and January 3, 2000 on July 22. Securities traded in the simulations included stocks, options, bonds and mutual funds, among others. The tests were carried out on separate, Y2K-ready systems, which led to the lion’s share of the problems that did occur, according to the SIA. Some of the duplicate systems employed did such things as fail to recognize test symbols or send trades to the incorrect regional exchanges. Those problems either have or are in the process of being worked out for the next round of testing, slated for next March. It will include a larger number of firms, which will proportionally increase the number of trades tested. This first test was really a test of test according to the SIA, carried out mainly to develop the scripts and procedures to be used in the large-scale dress rehearsal in March. The SIA and member firms are encouraged by the preliminary tests and the general feeling is that general compliance efforts in the securities industry are on schedule. Last month, the US Justice Department gave the SIA its seal of approval on securities firms sharing information about Y2K compliance without fear of violating federal antitrust legislation (CI No 3,453).
