How do I make component's background transparent on form?

this is my code for the component. I got the solution to make the backcolor transparent from the Microsoft website, and from stack overflow but it doesn't work:

public RedCircle()
    {
        SetStyle(ControlStyles.SupportsTransparentBackColor, true);
        this.BackColor = Color.Transparent;
        InitializeComponent();
        this.Paint += new PaintEventHandler(RedCircle_Paint);

    }

    private void RedCircle_Paint(object sender, PaintEventArgs e)
    {
        Graphics g = e.Graphics;
        g.FillEllipse(Brushes.Red, new Rectangle(5, 5, 25, 25));
    }

End result on form: