Is this trend a good trading opportunity?
Will Auto Trader turn, or will it continue to rise to 550p new all-time highs?
- Shares +34% since mid-October; +8.6% this week.
- Shares broken above long-term rising highs around 479p this week.
- Now trading 502p (at the time of writing), just off record highs.
- Will the positive momentum continue to 550p new all-time highs?
- Shares -0.6% from 2019 highs; +15.8% from 2019 lows; +10.25% year-to-date.
- 5 Feb: Citi says Auto Trader’s core used-car marketing business remains robust.
- Source: Bloomberg, FT, Reuters, DJ Newswires, AlphaTerminal
Trading Auto Trader – 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 Auto Trader using a CFD, at the current price of 502p. To do this, you need £2,000.
Let’s assume the Auto Trader trend continues to 550p new all-time highs (+9.5%). Your profit would be £9500, 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. Auto Trader 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.