Tag Archives: New York Stock Exchange

Citi-Split May Trigger Margin Calls

According to a market statement, Citigroup will have a reverse stock split effective after the close of trading on May 6, 2011, and Citigroup’s common stock will begin trading on a split adjusted basis on the New York Stock Exchange at the opening of trading on Monday morning. If you’re in the market you should check your mailbox.

If a corporate action materializes, the client accepts that FxPro reserves the right to make appropriate adjustments to the value and/or the size of a transaction and/or number of any related transactions.

FxPro Financial Services


Although I’m not trading, I receive many of the same alert that ordinary investors do. This morning I got a warning of a possible margin call from the online broker FxPro Financial Services.

The following statement was issued Friday afternoon through the usual market information channels:

Please note that Citigroup Inc. (NYSE: C) will have a reverse stock split which will be effective after the close of trading on May 6, 2011, and that Citigroup Inc. common stock will begin trading on a split adjusted basis on the New York Stock Exchange (NYSE) at the opening of trading on May 9, 2011. When the reverse stock split becomes effective, every (10) ten shares of issued and outstanding Citigroup common stock will be automatically combined into (1) one issued and outstanding share of common stock without any change in the par value per share.

The following small print message was also attached:

Note: A reverse stock split reduces the number of shares in the market and increases the share price proportionately. For example in a 1:10 reverse stock split the number of shares in the market is reduced by 10 times and stock price increases by 10 times (although the opening price after a reverse split may have a deviation from this price).

The result of a maneuver like this is a reduction in the number of a corporation’s shares outstanding that increases the par value of its stock, or its earnings per share.
The market value of the total number of shares (market capitalization) remains the same.
For example, a 1-for-2 reverse split means you get half as many shares, but at twice the price.
It’s usually a bad sign if a company is forced to reverse split – firms do it to make their stock look more valuable when, in fact, nothing has changed.
A company may also do a reverse split to avoid being delisted.
Thou, I can’t really imagine Citigroup being delisted on NYSE – that would really stir the pot, I guess…
A 17 percent plunge in the Citigroup share price last Friday triggered a five-minute trading pause.
It also triggered at debate about the three-week old curcit=braker system that’s been implemented.
Whether the drop in Citigroup’s market value was justified or not, didn’t seem to bother anyone…
Anyway –  this morning I received the following notice from the online broker FxPro:
FxPro Terms and Conditions (CORPORATE ACTIONS 8.1):

If a corporate action materializes, the client accepts that FxPro reserves the right to make appropriate adjustments to the value and/ or the size of a transaction and/ or number of any related transactions; any such adjustment aims in preserving the economic equivalent of the rights and obligations of both the client and the Firm immediately prior to a corporate action. It should be noted that these adjustments are conclusive and binding upon the client; the client will be informed accordingly by the Firm as soon as reasonably practicable.

Thank you for your collaboration.

Sincerely yours,
Dealing Desk,
FxPro Financial Services Ltd.

Well, it doesn’t matter much to me, but I guess if you’re in the market, either directly as an investor in Citigroup, or indirectly by EFT‘s, CFD’s or other derivatives, you should check your mailbox immediately to avoid any nasty surprises on Monday morning.


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Top 10 Cyber Threats of 2011 – Updated

PandaLabs, the antimalware laboratory of Panda Security, the cloud security company, has forecasted several radical innovations in cyber-crime for 2011. Hacktivism and cyber-war; more profit-oriented malware; social media; social engineering and malicious codes with the ability to adapt to avoid detection will be the main threats.

“There will also be an increase in the threats to Mac users, new efforts to attack 64-bit systems and zero-day exploits.”

PandaLabs

Here is a summary of what PandaLabs now predicts as the ten major security trends of 2011:

1. Malware creation:
In 2010, PandaLabs witnessed significant growth in the amount of malware and discovered at least 20 million new strains, more than in 2009. At present, Panda’s Collective Intelligence database stores a total of more than 60 million classified threats. The actual rate of growth year-on-year however, appears to have peaked. Several years ago it was over 100 percent and in 2010 it was 50 percent.

2. Cyber war:
Stuxnet and the WikiLeaks cables suggesting the involvement of the Chinese government in the cyber-attacks on Google and other targets have marked a turning point in the history of these conflicts. Stuxnet was an attempt to interfere with processes in nuclear plants, specifically, with uranium centrifuge. Attacks such as these, albeit more or less sophisticated, are still ongoing, and will undoubtedly increase in 2011, even though many of them will go unnoticed by the general public.

3. Cyber-protests:
Cyber-protests , or hacktivism, are all the rage and will continue to grow in frequency. This new movement was initiated by the Anonymous group and Operation Payback, targeting organizations trying to close the net on Internet piracy, and later in support of Julian Assange, editor-in-chief of WikiLeaks. Even users with limited technical know-how can join in the distributed denial of service attacks (DDoS) or spam campaigns. Despite hasty attempts in many countries to pass legislation to counter this type of activity effectively by criminalizing it, PandaLabs believes that in 2011 there will be more cyber-protests, organized by this group or others that will begin to emerge.

4. Social engineering:
Cyber-criminals have found social media sites to be their perfect working environment, as users are even more trusting with these than with other types of tools, such as email. Throughout 2010, PandaLabs witnessed various attacks that used the two most popular social networks – Facebook and Twitter – as launching pads. In 2011, not only will hackers continue to use these networks, but it is predicted that they will also be used more for distributed attacks.

BlackHat SEO attacks (indexing and positioning of fake websites in search engines) will also be widely employed throughout 2011, as always, taking advantage of hot topics to reach as many users as possible. In addition, a significant amount of malware will be disguised as plug-ins, media players and other similar applications.

5.Windows 7 influencing malware development:

It will take at least two years before there is a proliferation of threats designed specifically for Windows 7. In 2010, PandaLabs began seeing a shift in this direction, and predicts that in 2011, new cases of malware targeting users of this new operating system will continue to emerge.

6.Mobile phones:

In 2011 there will be new attacks on mobile phones, but it will not be on a massive scale. Most of the existing threats target devices with Symbian, an operating system which is now on the wane. Of the emerging systems, PandaLabs predicts that the threats for Android will increase considerably throughout the year, becoming the number one mobile target for cyber-crooks.
7. Tablets:

The dominance of the iPad will start to be challenged by new competitors entering the market. Therefore PandaLabs does not believe that tablet PCs will become a major consideration for the cyber-criminals in 2011.

8. Mac:

Malware for Mac exists, and will continue to exist. And as the market share of Mac users continues to grow, the number of threats will grow. The greatest concern is the number of security holes in the Apple operating system. Developers will need to patch these holes as soon as possible, as hackers are well aware of the possibilities that these vulnerabilities offer for propagating malware.

9. HTML5:

HTML5 is the perfect target for many types of criminals and could eventually replace Flash. It can be run by browsers without any plug-ins, making it even more attractive to find a security hole that can be exploited to attack users regardless of which browser they use. PandaLabs expects to see the first attacks on HTML5 in the coming months.

10. Highly dynamic and encrypted threats:
PandaLabs expects dynamic and encrypted threats to increase in 2011. PandaLabs is receiving more and more encrypted, stealth threats designed to connect to a server and update themselves before security companies can detect them. There are also more threats that target specific users, particularly companies, as information stolen from businesses will fetch a higher price on the black market.

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EU Institutions Hit By Major Cyber Attack

The European Commission and the External Action Service have been hit by a major cyber attack ahead of a key EU summit where crucial decisions on the future structure of the bloc, countries’ economic strategies and the ongoing war in Libya are to be discussed, according to news reports.

“We’re regularly hit by cyber attacks, but this one’s a big one.”


An internal email seen by the EUobserver.com and sent to all staff warned: “We have found evidence that both the commission and EEAS are the subject of an ongoing widespread cyber attack.”

The commission will not comment on the nature of the attacks due to security concerns, but has confirmed the institutions are indeed the focus of a serious strike.

Meanwhile officials are comparing the attack to an assault on the French finance ministry last year ahead of a G20 meeting.

“We’re regularly hit by cyber attacks, but this one’s a big one,” an EU source familiar with the matter that did not want to be named says.

The commission is currently attempting to assess the scale of the threat underway and in order to prevent the “disclosure of unauthorised information”, and has shut down external access to email and the institutions’ intranet.

All staff have been asked to change their passwords and to send sensitive information via secure email.

One EU source suggested the attack was similar to the massive assault which bombarded the French finance ministry last last year and was described by budget minister François Baroin as “spectacular”.

The authors of the attack had been particularly interested in files on the G20 summit held in Paris in February.

At the time, Patrick Pailloux, the head of France’s National Agency for Information Systems Security described the attack as “pure espionage … one of the most important attacks, if not the most important, ever to target the public administration.”

Some 150 computers were affected. French officials also suggested that some of the information was redirected to Chinese sites.

An EU source suggested that in this case too, China may be among the suspects.

“This is an important summit in many ways. There are people who want to know what the different positions are in what’s being discussed.”

In the attack on Brussels officials are publicly refusing to discuss the scale of the attack or its source.

“We are not speculating on the origin,” EU institutional affairs spokesman Anthony Gravali tells the EUobserver.com.

It is thought to be the first such attack on the External Action Service, although Gravali was keen to downplay this record.

“It’s difficult to say whether this is the first one. So much of the EAS is still technically DG Relex [the external relations department of the commission, the precursor of the EAS],” he says.

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