Will Compass Group turn, or will it continue beyond 1713p?

• The chart shows Compass’ price action over the last 8 weeks.
• Shares in a monthlong uptrend from 1469p October lows; now at 1639p.
• The shares have risen over 5% in the past week. Will this momentum continue?
• Shares -7.8% from 2018 highs; +13.7% from 2018 lows; +2.5% year-to-date.
• 20 Nov: Company’s full-year results were broadly in-line with expectations
• 20 Nov: Analysts at Hargreaves Lansdown say the catering contractor could return more cash to shareholders.
• Source: Bloomberg, FT, Reuters, DJ Newswires

Click to enlarge

Trading Compass – An Example

Let’s say the trend appeals to you, you think it’s likely to continue. You decide to buy exposure to £10,000 worth of Compass using a CFD, at the current price of 1639p. To do this, you need £2,000.

Let’s assume Compass trend continues beyond 1713p Oct highs (+4.5%). Your profit would be £450, 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. Compass falls 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.