Intense trading activity without major changes in the price took place during Tuesday`s trading session for Kunekt Corporation (OTC:KNKT) stock. The all-time high volume of 611 thousand shares did not have much of an impact as the price went from $0.89 to $0.90. In fact, since its introduction to the stock market in 2008, Kunekt Corp. stock never enjoyed too much of attention from investors. It was not until 2010 that some increase in volume and price could be noticed. Until last December the pattern followed was one of sharp increases or decreases separated by weeks of no trading activity whatsoever.
After Dec. 2010 on the hand, a steady increase of the stock price began, with a sharp increase at first and a maintained higher level over the last few weeks. For such a bounce to happen, a catalyst was needed and it seems that the company has found one. No decline has followed so far, which would be typical considering how the stock performed not so long ago.Kunekt Corporation was originally organized to enter the financial services market with a product called the Kunekt Card. This product is similar to the typical credit card. The benefit of using it should have been that it is linked to multiple financial accounts, thus relieving a person from carrying any other cards. As the company was engaged in developing its product and filing patent submissions, it has never generated any revenues nor attracted much of interest for its stock.
In Dec. 2010 though, the company announced it is making a major shift in its main line of business, namely towards designing, building and marketing mobile phones, smartphones and tablets. That same month, the company also filed a trademark application for its Kunekt smartphones and mobile phones. It is also in the process of acquiring MS-INT Asia Limited, a Hong Kong based company.[BANNER]
This sharp shift to a different segment had a positive effect on the market. Whether it would last, is another matter entirely. In a long-term perspective there is too much uncertainty. First of all, the company enters a market it has no experience in, one where some of the most powerful technology companies compete. Second, raising capital is needed in order to convert this new project into profits, which is also of big concern for the company.
Investors, as few as they were in the past, believed that KNKT financial card project would be successful and would increase the price of the stock. That old business is now completely forgotten and time would tell whether mobile phones and tablets are the next project to go down the drain.
