The stock market intermediation company SSIF Broker, which is to float its stock on the Bucharest Stock Exchange over the following weeks, managed to increase its gross profits by 20 billion ROL (0.5 million euros) over the July-October period due to higher prices on the stock market.
According to company representatives, Broker gained an additional 13 billion ROL (0.3 million euros) in November from the price gaps related to the stock in its portfolio. Broker expects to achieve gross profits of 70 billion ROL (1.7 million euros) by the end of this year, as compared to the 50 billion ROL it registered in late October.
Though Broker's main activity is intermediation in transactions on the stock exchange and the Rasdaq, the company this year gained more from its own stock portfolio than from commissions from its clients.
"The ratio between the gains from stock price differences and the gains from trading commissions is about three to one," said Petru Prunea, the company chairman.
Broker books profits generated by the increase in stock prices only at the time when stock is sold. Given this year's increases in stock prices on the stock market, the current stock portfolio held by Broker has profit-generating potential. "We hold stakes in some of the most traded stocks on the stock exchange, such as BRD, Petrom and Compa. We also own stock in companies listed on the Rasdaq, with many of these being traded using the technical system of the market," explained Prunea, adding that Broker's strategy over the following period would be to focus on the stock of fledgling companies with growth potential.
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