Will National Grid continue falling, or will it rise again back to 852.7p recent highs?

• National Grid shares have fallen over 10% from last weeks highs. Was as low as -12.2% yesterday.
• Already bounced +2.1% from recent lows. Currently trading at 764.5p (at time of writing).
• Shares falling following Ofgem proposal to cut the rate of return for electricity/gas network investments.
• 18 Dec: Brokers at AJ Bell say National Grid’s dividends could be in danger.
• Shares -15.2% from 2018 highs; +3.5% 2018 lows; -12.5% year-to-date.
• Can the stock recover to December highs?
• Source: Dow Jones, Bloomberg, FT, Company News, AlphaTerminal

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Trading National Grid – An Example

Let’s say you feel that the stock is a bargain and you think could bounce back towards recent highs of 852.7p. You decide to buy exposure to £10,000 worth of National Grid using a CFD, at the current price of 764.5p. To do this, you need £2,000.

Let’s assume National Grid recovers back to 852.7p recent highs (+11.5%). Your profit would be £1150, from your initial investment of £2,000.

Conversely, let’s assume you open the above position, and place a stop-loss at 4% from the current price. National Grid falls 4% and hits your stop-loss. Your loss would be £400.

This is provided for information purposes only. It should not be taken as a recommendation.