The 1987 crash triggered in part by computerized portfolio insurance and worldwide selling was Black Monday.
On October 19, 1987, stock markets around the world fell sharply. The Dow Jones Industrial Average lost 22.6% in a single session, while other major markets also recorded severe declines. The synchronized fall made the episode an international crash rather than an isolated U.S. market event.
Researchers and regulators identified several contributing factors, including high valuations, rising interest rates, trade tensions, and concerns about the dollar. Computerized portfolio-insurance strategies could automatically sell futures as prices declined, adding pressure and creating a feedback loop.
Black Monday is distinct from the 1929 Wall Street crash, even though both are associated with dramatic October declines. The 1987 collapse did not produce the same prolonged economic depression, and markets eventually recovered. In response, exchanges developed circuit breakers and other mechanisms intended to slow extreme sell-offs.