AA
A trading opportunity for you?
Will AA continue falling, or will it rise again back to September high of 127p?
- AA shares have fallen 7% today after a broker downgrade.
- Analysts at Credit Suisse downgraded the shares to Underperform and lowered the target price to 70p (from 110p).
- Currently trading at 100p (at time of writing).
- Shares -39.5% from 2018 highs; +55% from 2018 lows; -41% year-to-date.
- Recent share price range: Sept lows 91p; Sept highs 127p.
- Can the stock recover to yesterday’s highs?
- Source: Dow Jones, Bloomberg, FT, Company News
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Trading AA – An Example
Let’s say you feel that the stock is a bargain and you think it could bounce back to recent highs of 127p. You decide to buy exposure to £10,000 worth of AA using a CFD, at the current price of 100p. To do this, you need £2,000.
Let’s assume AA recovers back to 127p (+27%). Your profit would be £2700, from your initial investment of £2000.
Conversely, let’s assume you open the above position, and place a stop-loss at 9% from the current price. AA falls 9% and hits your stop-loss. Your loss would be £900.
This is provided for information purposes only. It should not be taken as a recommendation.