Will Severn Trent continue falling, or will it rise again back to 1969p recent highs?

• Severn Trent share price has fallen over 6% since the middle of last week.
• Now trading at 1837p (at the time of writing).
• Shares are down over -16% from 2018 highs, +10% from 2018 lows, -15% year-to-date.
• Water utility’s shares falling after H1 results showed that hot summer weather pushed up costs.
• Can the shares regain recent highs?
• Source: Bloomberg, FT, Reuters, DJ Newswires, AlphaTerminal

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Trading Severn Trent – An Example

Let’s say you feel that the stock is a bargain and you think could bounce back towards 1969p. You decide to buy exposure to £10,000 worth of Severn Trent using a CFD, at the current price of 1837p. To do this, you need £2,000.

Let’s assume Severn Trent recovers back to recent highs of 1969p (+7.1%). Your profit would be £710, 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. Severn Trent 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.