This report is not a personal recommendation and does not take into account your personal circumstances or appetite for risk.
Reporting season is in full swing right now. We have seen some massive movements already on or around reporting day.
Let’s look at this week alone. ITV jumped over 7% on the back of results. Astrazeneca moved up 7.7% (A massive move for a traditionally defensive stock). Today alone Vodafone are up 7.5% on the back of their results (Percentage accurate at time of writing).
Now this is not to say that all companies that report results will be positive.
How should you trade results?
There are options. Some clients choose to get in ahead of results. They may think the results will be good and beat expectations and pick up a long position and try grab a big move up.
What if you think results may be poor? You do have the flexibility with us to short a position, to profit from a falling stock price.
Others wait to see what the company’s results look like. This does mean you might to miss out on an initial spike in the price.
Remember spikes can go down as well as up.
If you were to see a 10/15/20%+ drop, some clients would look at this as an opportunity for a bounce in the share price, they may believe the drop has been overdone and see this as an opportunity!
That brings us to this week. We have a host of companies reporting including (for a full list of companies reporting next week, see the week in advance) BP, Taylor Wimpey, Lloyds, BAE, British American Tobacco, Barclays. Shell, Rio Tinto, IAG & RBS could we see similar movements this week? which of these are opportunity for you?
If you trade big movements. Companies reporting have potential to deliver big share price moves when they report their results. To make sure you are aware of broker previews about what to expect (revenues, profits, growth outlook), as well as actionable trade ideas daily, make sure you sign up to our Research Gold Pass.
Enjoy your weekend.
Chris Peters, Senior Trader, 19 July 2019
This research is produced by Accendo Markets Limited. Research produced and disseminated by Accendo Markets is classified as non-independent research, and is therefore a marketing communication. This investment research has not been prepared in accordance with legal requirements designed to promote its independence and it is not subject to the prohibition on dealing ahead of the dissemination of investment research. This research does not constitute a personal recommendation or offer to enter into a transaction or an investment, and is produced and distributed for information purposes only.
Accendo Markets considers opinions and information contained within the research to be valid when published, and gives no warranty as to the investments referred to in this material. The income from the investments referred to may go down as well as up, and investors may realise losses on investments. The past performance of a particular investment is not necessarily a guide to its future performance.Prepared by Michael van Dulken, Head of Research