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February 06, 2007
Red Monitor Founder Readies New Digital Options Exchange
Austrian startup Red Monitor is a new online digital options exchange in beta that has a predictive markets appeal. Unlike other new web apps, this one doesn't want you to share your photos and video, rather share your predictions about the movement of a stock and make bets accordingly.
The a:c euro is no expert on derivatives and exotic investment products, but we ran it by one of our longtime industry sources, whose been running currency information and trading systems here for over a decade. He said that Red Monitor "fills a gap", an area of the online trading market that hasn't seen widespread take up yet.
The Demo At Red Monitor Shows The Predictive Market In Action
We think the startup is one to look at mainly because of the founder Hubertus Hofkirchner. He has already built two online brokerages for Austrian banks and as CEO he did an impressive turnaround of Austrian mobile operator, tele.ring.
When Western Wireless International acquired tele.ring in 2001 for €10 (yes ten euros) he was appointed as CEO of the unprofitable mobile network operator. Hofkirchner took the company into the black and it was then acquired by T-Mobile last year for €1.3B. He had shares in the company which contributed in part to his being able startup Red Monitor.
Hofkirchner plans to launch officially in April. The service operates under the eyes of the Austrian Finanzmarktaufsicht, the equivalent of the FSA in the UK and supports predictions for shares traded on several stock exchanges, as well as indexes.
Hofkirchner believes that it will appeal to both consumer (retail) investors as you can start off with a €10 balance in the account, and professionals. Leverage is available, up to 250 percent. Why would pros use it? The founder answered: "Apart from reducing trading cost and providing greater flexibility for trading strategies, digital leverage will reduce capital requirements and make risk more manageable."
The image below shows the flow of info at Red Monitor.
The big question mark over Red Monitor, is it unique enough to compete against banks that offer this kind of trading online and how big is the market for this kind of thing. The plan is to support multiple currencies and languages - next is English.
Given his track record, we think that Hofkirchner is in a position to figure out what it takes to make this a bigger business. Although we wonder about calling the firm Red Monitor - call it a knee jerk reaction but red isn't the colour you want associated with the balance in your online trading account.
Link- Red Monitor
Posted on February 6, 2007 06:40 AM | Posted to Early stage | Permalink
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