In the blink of an eye, Knight Capital Group (NYSE:
) has gone from a prominent financial services company to a
struggling entity that might not be saved. When news broke that
several institutions, including Jefferies (NYSE:
), Stifel Nicolaus (NYSE:
), Blackstone Group (NYSE:
), and TD Ameritrade (NYSE:
) had stepped in to provide Knight Capital with $400 million in
financing, some believed that the .
Regardless, investors are not yet satisfied. Since August 1,
Knight Capital has lost more than 70 percent of its value. There
was hope on Friday when the stock rose nearly 60 percent from its
all-time low of $2.58. This morning, however, investors are much
less enthused, as Knight Capital shares have dropped by more than
The fallout could be catastrophic. Even if the firm were to make
a complete recovery, that would not change the fact that its error
(an apparent technical glitch) has for Level 3 Communications
(NYSE: ), NuSkin (NYSE: ), GameStop (NYSE: ), Goodyear Tire (NYSE:
), Manitowoc (NYSE: ), Corelogic (NYSE: ), Pandora Media (NYSE: ),
and Allegiant Travel (NASDAQ: ), among others.
Long-term, corporations and traders are not the only ones that
will be caught in the crossfire. Knight Capital might have to cut
costs by reducing its staff at some point. If that happens, there
will be a lot of qualified members of the financial community
seeking quality work.
In the past, it was not easy for unemployed financial
professionals to find a good job.
hopes to change that.
"We work with a number of the smaller broker-dealers on the
Street, particularly in New York," said Jesse Marrus, founder of
StreetID. "They are always going to be looking for talented people,
particularly coming from a place like Knight."
Marrus said that there is a "parachute effect" where job seekers
can "get to the StreetID platform, register for an account, and
immediately be found by our broker-dealer clients that are looking
for people with these exact skill sets."
If layoffs occur at Knight Capital, Marrus said that StreetID
will be ready. However, he is very supportive of the company and
still believes that there is a chance for it to pull through.
"I think the one thing that might save them is that it is a
purely technical issue," Marrus said on Friday. "If somebody
believes that this is still a viable company, they might step in
and save them."
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