TechFinancials applies to list on NEX. What for?

Maria Nikolova

The company sees its plan to dual list its shares on the NEX as being entirely complimentary to its AIM listing.

In a financial world where cross-listings bring a handful benefits and loads of extra costs, TechFinancials Inc (LON:TECH) which until recently grappled with the issue of how to dispose of its Cypriot binary options business, has decided to stick to trivial wisdom and apply for admission to the NEX Exchange Growth Market.

The relevant announcement was released earlier today. The company says it has applied for admission of its entire issued share capital of 84,980,979 fully paid ordinary shares of USD0.0005 to trading on the NEX Exchange Growth Market (“NEX”), with the admission set to to take place on or around August 8, 2018.

TechFinancials sees its plan to dual list its shares on the NEX as being entirely complimentary to its AIM listing, and the company plans to remain trading on AIM following its admission to NEX.

Next up comes the most important part: the explanation of the rationale for such a dual listing. Unfortunately, all TradeFinancials does is appeal to outdated conventional phrases when it comes to dual listing.

“The Directors believe that a dual listing on NEX will increase the visibility of the Company in the market; may potentially enhance liquidity for the Company’s shares; and create a solid platform on which the Directors can continue to promote the Company’s growth”.

However, none of this seems to be compelling.

  • First off, analysts tend to provide coverage (and thus increase visibility) of larger companies, regardless of whether they are dual listed or not. Plus, the difference in coverage is pretty small if a company is cross listed as compared to if it is not.
  • Second – the trading volumes of cross-listed shares typically account for a very small percentage (not more than 5%) of trading volumes of a company’s shares. Hence, the argument about enhanced liquidity is not valid.
  • Furthermore, the promotion may happen in terms of press releases but these will barely help if the company does not demonstrate actual growth and return on invested capital (ROIC).
  • In addition, dual-listed companies face higher costs – exchange fees, for example, and much higher compliance costs.
  • Finally, let’s not forget that investors tend to invest in shares they find attractive – and the dual listing itself can hardly be called a factor in that decision-making process.

Read this next

Institutional FX

Euronext’s FX volume takes yet another step back in July

Pan-European exchange, Euronext has reported a 7.6 percent drop in the average daily volume on its spot foreign exchange market. The ADV figure stood at $21.4 billion in July 2022, which is down from June’s $23.1 billion.

Executive Moves

IG Group strengthens institutional sales with appointment of Glen Hastings

IG Group, Europe’s largest online trading platform, has onboarded Glen Hastings to the role of its institutional sales manager. He joins the FCA-regulated broker with immediate effect, based out of its offices in London.

Digital Assets

Voyager customers can withdraw up to $100K in cash via ACH transfer

Following approval of the bankruptcy judge, cryptocurrency brokerage firm Voyager plans to return $270 million in customer cash. The amount represents a small portion of investors’ crypto holding that have been locked up since the company filed for bankruptcy in April.

Retail FX

Britain’s lifeboat system to conclude LCG compensation scheme

Britain’s Financial Services Compensation Scheme (FSCS) said today it’s preparing to close the compensation scheme of the collapsed mini-bond provider, London Capital & Finance.

Uncategorized

Robinhood parts ways with its first CPO Aparna Chennapragada

In what apparently part of the restructuring it announced last month, Robinhood is parting ways with its Chief Product Officer Aparna Chennapragada. However, she’ll remain employed in an advisory role to the CEO through January 2023.

Digital Assets

Crypto.com expands regulatory footprint with new licence in South Korea

Crypto.com has acquired payment service provider ‘PnLink Co., Ltd.’ and virtual asset service provider ‘OK-BIT Co., Ltd.’ The move effectively provides a regulatory stamp for the company’s digital assets and cryptocurrencies business in South Korea.

Metaverse Gaming NFT

Why NFT Technology Could be the Much Needed Solution to Crypto Inheritance 

The digital asset market may have started with Bitcoin’s humble beginning but its fortunes have changed over the past decade.

Industry News

Kohle Capital Markets expands CFDs lineup to 200+ stocks

Kohle Capital Markets (KCM), the leading international provider of online trading, has once again expanded its contracts-for-difference (CFDs) offering, this time with the addition of new products on its trading platform.

Industry News

Kohle Capital Markets continues CSR initiatives with donation of art piece to Lions Club International

Global brokerage firm Kohle Capital Markets (KCM) is taking its corporate social responsibility very seriously and continues to navigate the challenging period brought forth by the pandemic and Russia-Ukraine war.

<