From car to travel to life, we round up the insurers who get the most plaudits.
Financial dangers of Twitter
A fake tweet has triggered a dramatic 143-point fall in the Dow, highlighting just how vulnerable the world’s financial markets are to misinformation on social media.
An official Associated Press (AP) Twitter account was hacked yesterday, which the hacker then used to tweet that there had been “two explosions in the White House” and that “Barack Obama is injured”.
AP deleted the tweet a short time later, but not before the fake comment had been retweeted thousands of times.
It sparked a dramatic sell-off of the Dow Jones industrial average, which plunged 143 points in no time.
Algorithms trigger the sell-off
Now it must be stressed that the Dow recovered as soon as it became apparent that the tweet was fake, but it has raised massive concerns over how the immediacy of social media can so dramatically influence financial markets.
In this particular instance, one of the main reasons for the sell-off was the impact of the numerous trading algorithms, which basically search all news and execute trades almost immediately in response.
So these algorithms had picked up “news” from an official news source and reacted accordingly.
Twitter security to be improved
When there are quite literally billions of pounds at stake, some analysts have expressed concerns that the markets can be swayed simply by someone hacking a Twitter account.
Which has led many to question the social media site’s security measures.
Twitter has announced plans to introduce a "two-factor authentication" process that would make it far more difficult for hackers to break into accounts even if they acquired the passwords, but no exact date has yet been given.
Which means such vulnerabilities remain in the short term.
Another problem with Twitter is that, once a false tweet goes out, it may be retweeted and seen by people who never see a subsequent retraction or clarification. So they might not actually realise they’ve seen incorrect information from an official news source.
Could criminals prosper?
What the AP hack highlights is how an individual or group was able to have a direct impact on the financial markets.
That raises the frightening possibility of someone employing the same strategy for financial gain. In theory, if a criminal were able to release fake information through an official source which they knew would drive the markets either up or down, they could stand to make a significant amount of money.
Now, it must be stressed that the hacking of official Twitter accounts of news organisations only happen rarely. And even if a hacker could gain access, they would have no way of guaranteeing that a fake tweet would have the intended impact.
But it does nonetheless highlight the growing impact that social media, and Twitter in particular, is having on global finances – and the new threats that it carries.
related stories on msn
There is hardly any physical "Money" involved in financial transactions, everything we think we "own" is now a collection of bytes held on computer.
Criminals who hack into our Bank Accounts are only a step away from being able to bring down the entire global financial edifice.
Invest in tins of food. They can't hack that.
more on msn money
msn money poll
Which measure in the autumn statement will help you most?
Thanks for being one of the first people to vote. Results will be available soon. Check for results
- Planned rise in rail fares to be reduced
- Increase in university places
- Cancellation of 2p fuel duty rise
- Cap on business rates
- Tax breaks for married couples
- Free school meals for infant school children
- Loans to "unblock" housebuilding in some cities