Is it irrelevant, or will the Upgrade make the Rio Tinto share price more attractive?

• Goldman Sachs upgrades to Buy (from Neutral), with a 5000p target (from 4100p).
• Consensus: 15 Buys, 12 Holds, 5 Sell; Avg target: 4334p (Source: Bloomberg).
• Current share price 4316p (at time of writing).
• Will the shares turn back, or will the upgrade push them towards 2018 highs of 4540p?
• Shares -1.5% from 2019 highs; +19.5% from 2019 lows; +15.7% year-to date.
• Source: Bloomberg, FT, Reuters, DJ Newswires, AlphaTerminal

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Trading Rio Tinto – An Example

Let’s say you think that Rio Tinto shares have upside potential as result of this broker upgrade. You decide to buy exposure to £10,000 worth of Rio Tinto using a CFD, at the current price of 4316p. To do this, you need £2,000.

For the purpose of this example, let’s assume the Rio Tinto share price rises to 2018 highs of 4540p (+5.1%). Your profit would be £510 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. Rio Tinto shares fall 3% and hit your stop-loss. Your loss would be £300.

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