Ouch! On Tuesday, derivatives broker MF Global
MF Global was spun out of U.K. hedge fund manager MAN Group last July. Since then, it has rattled the market once with a $142 million dollar loss courtesy of a rogue trader. That episode and the current profit warning illustrate the risks to a small financial firm that is focused on a narrow set of activities. Lehman Brothers
By contrast, Goldman Sachs'
Still, yesterday's selling looks overdone at first glance. MF Global's revised range for net revenue in the fiscal first quarter is $360 million to $390 million. The midpoint of that range would simply imply no growth over the year-ago quarter, which is hardly a disaster (although it falls far short of the 15%-20% net revenue growth the company set itself for fiscal 2009). With shares at this level, they may attract bargain-hunters. For my part, I think there are enough other opportunities now in simpler businesses that I'll take a pass on MF.
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