Washington/Brussels - FIA Principal Traders Group and FIA European Principal Traders Association said they would review their recommendations on technology tests for trading firms once the facts were known as to what caused the costly software glitch at Knight Capital Group.

The glitch, which caused Knight to issue a flood of erroneous buy and sell orders for the first half hour of trading on Wednesday, resulted in a $440 million loss for the firm.

"It is not clear yet what caused the problems at Knight Capital, but once the facts are out, we will review our recommendations and amend if needed," the trade associations said in a joint statement.

"Knight's difficulties highlight how quickly the market punishes trading mistakes, but also how important it is for market participants to work with regulators to minimize threats to market stability. We stand ready to share our expertise with regulators as they examine what happened at Knight Capital and consider what reforms are necessary to safeguard our markets."

FIA PTG and FIA ETPA said they had issued several reports with specific recommendations for trading firms, brokers and exchanges.

"Earlier this year, the FIA PTG and FIA EPTA issued a paper that recommended a number of specific tests and controls that trading firms should consider whenever they change their technology systems," the groups said. "Technology is a core component of modern markets, and we strongly believe that managing technological change must be an essential element of risk management for all market participants."

A paper on best practices for software development and change management can be found here.