Diageo
A trading opportunity for you?
Will Diageo break support, or will it rise again back to 3000p ?
- Diageo has rising support since summer 2015
- Bounced off trendline 6 times, most recently today. Now trading 2546p (at time of writing)
- Will the pattern repeat itself, bouncing up again towards 3000p?
- Shares -9.9% from 2018 highs; +10.9% from 2018 lows; -6.5% year-to date
- Multinational alcoholic beverages company (Gordon’s, Smirnoff, Guinness, Bailey’s)
- 20 Sept: Diageo shares already reflect currency hit, says Jefferies
- 20 Sept: Diageo continues to execute well says Shore Capital
- Source: Bloomberg, FT, Reuters, DJ Newswires
Trading Diageo – An Example
Let’s say you like the Diageo trend, you think it’s heading back towards 3000p again. You decide to buy exposure to £10,000 worth of Diageo using a CFD, at the current price of 2546p. To do this, you need £2,000.
Let’s assume Diageo recovers back to 3000p (+17.8%). Your profit would be £1780, from your initial investment of £2,000.
Conversely, let’s assume you open the above position, and place a stop-loss 5% below the current price. Diageo falls 5% and hits your stop-loss. Your loss would be £500.
This is provided for information purposes only. It should not be taken as a recommendation.