RBS
Is this breakout a good trade for you?
Will Royal Bank of Scotland turn, or will it continue to break upwards beyond 262p?
- The chart shows the last 3 month’s price action for Royal Bank of Scotland.
- It has today broken above a resistance line at 259p.
- The ‘trend is your friend’. Will it continue?
- RBS may benefit from higher UK interest rates
- Goldman Sachs (12 Sept) says RBS cash-return prospects better than peer Lloyds
Click to enlarge
Trading Royal Bank of Scotland– An Example
Let’s say the breakout appeals to you, you think it’s likely to continue. You decide to buy exposure to £10,000 worth of Royal Bank of Scotland using a CFD, at the current price of 262p. To do this, you need £2,000.
Let’s assume Royal Bank of Scotland‘s trend continues to May highs of 297p (+13%). Your profit would be £1335, from your initial investment of £2,000.
Conversely, let’s assume you open the above position, and place a stop-loss at 5% from the current price. Royal Bank of Scotland’s trend breaks down, falling 5% and it hits your stop-loss. Your loss would be £500.
This is provided for information purposes only. It should not be taken as a recommendation.