Will Legal & General break higher, or will it fall back again to 235p?

• The Legal & General trading range has developed since mid-May .
• Shares bounced back from resistance trend-line three times, most recently this week.
• Now trading 258p (at time of writing).
• Will the pattern repeat itself, testing previous lows?
• Shares -11.3% from 2018 highs; +8.1% from 2018 lows; -5.6% year-to-date
• 8 Oct: Completes £2.4bn buyout for Nortel Networks UK Pension Plan
• 13 Sept: Completes £4.4bn buy-in with British Airways’ Pension Scheme
• Source: Bloomberg, FT, Reuters, DJ Newswires

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Trading Legal & General– An Example

Let’s say you like the Legal & General range, you think it’s heading back towards 235p again. You decide to sell exposure to £10,000 worth of Legal & General using a CFD, at the current price of 258p. To do this, you need £2,000.

Let’s assume Legal & General fall back to 235p (+8.9%). Your profit would be £890, 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. Legal & General rises 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.