Shareholders of Ozforex Group Ltd (ASX: OFX) have watched their shares fall sharply this week following Westpac Banking Corp's (ASX: WBC) shock announcement that it would end its relationship with the international payments company.
Although it is believed that the bank's decision did not reflect any concerns it had with the OzForex business specifically, Westpac said it would be transitioning away from international payments in general as a result of tightening regulatory requirements. While OzForex still has other Australian partners, the move by Westpac increases the risk involved in an equity investment in the business.
The shares fell by more than 10% on Monday and have lost a further 4.9% today to be trading at $2.31. At that price, they've fallen by more than 20% in the last fortnight while they're sitting 34% below their 52-week high of $3.50.
While OzForex could still deliver substantial returns in the long run, investors need to weigh up the risks in purchasing shares.
