Electrocomponents
Is this an opportunity to take a position ahead of the results?
Electrocomponents reports results tomorrow (Thurs, 4th Oct)
- The chart shows the price movement last time Electrocomponents (ECM) reported (5 July).
- The shares opened +16p (+2.2%) and traded as high as +51.2p (+7.0%).
- The shares fell as low as -1p (-0.1%) and closed +6.2p (+0.9%), for a daily trading range of 52.2p or 7.2%.
- On 5 July ECM shares rose after it reported revenue growth of 10% in Q1; good performance across all regions.
- Shares -7.8% from 2018 highs, +27.8% from 2018 lows, +14.8% YTD.
- Recent share price range: Aug lows 709p; Summer highs 767p. Currently 719p (at time of writing).
- ECM gives a Q2 Trading Update on Thursday (4 Oct). Will we see another big move?
Trading Electrocomponents – An Example
Let’s say you think that ECM results are likely to be good, and the share price is likely to rise. You decide to buy exposure to £10,000 worth of ECM using CFDs, at the current price of 719.4p. To do this, you need £2,000.
For the purpose of this example, let’s assume ECM reports strong results and the shares rise 10%. Your profit would be £1000, from your initial investment of £2,000.
Conversely, let’s assume you open the above position, and place a stop-loss 2% below the current price. ECM results miss, it falls 2% and hits your stop-loss. Your loss would be £200.
This is provided for information purposes only. It should not be taken as a recommendation.