Today TechFinancials announced (LSE RNS Number : 8957C) that it has completed and established the TechFinancials Optionfortune Trade Limited deal; Optionfortune being the Hong Kong-based outfit that has been operating a binary brokerage using the TechFinancials kit. The fact that this has been announced immediately after the New Year is a good sign; generally bad news is confined to Christmas Eve and between Boxing Day and New Year’s Eve!
It is doubtful that there would be many in the binary game that do not wish TechFinancials well after the battering their share price took last year. As the first outfit to raise their heads above the parapet, to place their cojones on the line, they have provided insight to the rest of the industry not by just making their numbers public but by operating as the industry pathfinder. This makes a change from other operators, e.g. anyoption, who perennially state they are going public but never seem to be able to make that final step.
TechFinancials Business Model
The rumoured threat of 24Option building their own proprietary platform may well have provoked TechFinancials to pursue this Optionfortune deal. The hybrid model of a B2B business running in tandem with a B2C business may well have run its course. Certainly the question must have arisen at TechFinancials board meetings as to why they are creating competition for their own B2C business OptionFair. By focussing on OptionFair and the HK JV the company could be taking a marked move towards becoming a primarily B2C operation: if 24Option no longer wish to use TechFinancials platform there is likely to be little point in TechFinancials supporting the other B2B clients. Should this situation come to pass, i.e. that TechFinancials becomes purely a B2C operator, it is likely that the investment community would welcome the news with the concordant advance in the share price.
Buy ‘Em When You Can……
…..not when you have to!
This age old options market adage would seem to apply here, well, certainly to those short the TechFinancials shares anyway. Since the 24Option rumour is probably already built into the TechFinancials share price the announcement from 24Option could in fact be the lift off TechFinancials shares need.