The pre-market trading window has opened on the New York Stock Exchange showing that FXCM Inc Shares are trading lower by about 85% from yesterday’s closing price. Currently, shares are changing hands at $1.80 having traded as high as $17 on Monday.
The impact of the $225 million prospective loss of capital, which the company published late yesterday, has yet to be fully digested by the market. Credit Suisse has issued a two notch downgrade on the shares of the publicly listed brokerage, setting a $4 target.
As of September 30th, FXCM held cash on hand amounting to $326.7 million, with the debt of the company amounting to $188 million.
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Credit Suisse analyst, A. Serreo, stated in the note detailing the downgrade, “We believe FXCM’s liquidity provider stopped making markets in the Swiss franc leaving the company unable to close losing client positions as the cushion provided by client collateral was absorbed.”
Citi has also issued a downgrade on FXCM today, setting a $5 target.
Despite publicly announcing no material exposure to the events unfolding yesterday, GAIN Capital’s share prices are down 23% before the market opens. Interactive Brokers is trading lower by 8.9%.
On the other side of the Atlantic, shares of publicly traded brokers, Plus500 and IG Group, are faring much better than their US peers. The UK’s largest CFD brokerage is trading 1.6% lower, while Plus500 is trading flat.