Is this trend a good trading opportunity?
Will AB Foods turn, or will it continue to rise to 2655p November highs?
- Shares +10% in 3 weeks
- Now trading 2498p (at the time of writing)
- Will the positive momentum continue to 2655p?
- Shares trade 2019 highs; +22% from 2019 lows; +19.75% year-to-date.
- 20 Mar: RBC says: “We would prefer to buy AB Foods […] for likely stronger full-price sales with additional cash returns”
- Source: Bloomberg, FT, Reuters, DJ Newswires, AlphaTerminal
Trading AB Foods – An Example
Let’s say the trend appeals to you, you think it’s likely to continue. You decide to buy exposure to £10,000 worth of AB Foods using a CFD, at the current price of 2445p. To do this, you need £2,000.
Let’s assume the AB Foods trend continues to 2655p (+9%). Your profit would be £900, from your initial investment of £2,000.
Conversely, let’s assume you open the above position, and place a stop-loss at 3% from the current price. AB Foods falls 3% and hits your stop-loss. Your loss would be £300.
This is provided for information purposes only. It should not be taken as a recommendation.