Will Premier Oil continue falling, or will it rise again back to Friday’s high of 81.8p?

• Premier Oil shares have fallen as low as -15% from Friday’s highs (11 Jan).
• Currently trading at 73.2p (at time of writing).
• Shares falling after The Times reported that the oil company is considering a cash call to help it buy about $1.5bn of fields in the North Sea.
• Shares -15% from 2018 highs; +5.4% from 2019 lows; +9% year-to-date.
• Can the stock recover to recent highs?
• Source: Dow Jones, Bloomberg, FT, Company News, AlphaTerminal

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Trading Premier Oil – An Example

Let’s say you feel that the stock is a bargain and you think it could bounce back to recent highs of 81.8p. You decide to buy exposure to £10,000 worth of Premier Oil using a CFD, at the current price of 73.2p. To do this, you need £2,000.

Let’s assume Premier Oil recovers back to recent high of 81.8p (+11.7%). Your profit would be £1170, from your initial investment of £2000.

Conversely, let’s assume you open the above position, and place a stop-loss at 5% from the current price. Premier Oil falls 5% and hits your stop-loss. Your loss would be £500.

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