Posts from — November 2010

Financial Market Comments from Ben Critchley, Sales Trader, IG Index.

Mid-morning, the London index is clinging onto marginal gains but equity markets in general are struggling to find support.

In essence, the equity spread betting markets have rejected the Irish bailout plan, with fears that further Eurozone countries will now run into difficulty weighing on Euro-denominated assets.

In London, it’s the energy stocks that are managing to keep the FTSE in positive territory with rising oil prices, but even these gains are looking vulnerable as the morning proceeds.

There’s little in the way of economic news due out and disappointing German unemployment data is again doing little to help the common currency, as the Euro tests territory below $1.3000 against the Dollar for the first time in over 10 weeks.

Wall Street managed to stage a recovery late yesterday as traders realised that the sell-off on the back of Euro fears was perhaps a little overdone, but uncertainty here does look set to linger.

Futures prices are currently pointing towards a lower start to the month’s final session but at least there’s the US consumer-confidence reading due at 3pm (London time).

Given the solid nature of Black Friday’s retail-sales figures, expectations are upbeat, so a positive signal to the market could well see the bargain hunters coming back into play.

Traders, however, won’t be taking their eyes off the somewhat perilous state of the Eurozone, and this is certainly going to cast a shadow over December.

Spread betting carries a high level of risk to your capital. You may lose more than your initial investment. It may not be suitable for all investors. Only speculate with money that you can afford to lose. Please ensure you fully understand the risks involved and seek independent financial advice where necessary.

Good Luck!

DB

The above comments do not constitute investment advice and Clean Financial accepts no responsibility for any use that may be made of them.

Content provided by IG Index which is Authorised and regulated by the Financial Services Authority. FSA Register number 114059.

Financial Market Comments from Ben Critchley, Sales Trader, IG Index.

In mid-morning trade equities in London are making a subdued start to the week.

Early gains for the FTSE 100 have been chipped away as trade has continued.

We had seen a stronger opening on the back of the Irish bailout deal, with the banking and finance stocks leading the way. These are still the top of the blue-chip table at the moment although much of that early enthusiasm has faded.

It’s no secret why investors are still nervous. The worry is that Ireland won’t mark the end of the Eurozone crisis and, with the economies of Portugal and Spain looking less than robust, markets are worried that we could be talking about potential bailouts once again in the not too distant future.

Looking ahead to the US open, at the moment we are expecting the Dow Jones to start off around 30 points lower when trading resumes after the Thanksgiving lull.

Sales for the ‘Black Friday’ retail extravaganza were higher than last year but only by 0.3%. With little reason to inspire much volatility today we could be in for something of a sideways week ahead of Friday’s latest US unemployment numbers.

Spread betting carries a high level of risk to your capital. You may lose more than your initial investment. It may not be suitable for all investors. Only speculate with money that you can afford to lose. Please ensure you fully understand the risks involved and seek independent financial advice where necessary.

Good Luck!

DB

The above comments do not constitute investment advice and Clean Financial accepts no responsibility for any use that may be made of them.

Content provided by IG Index which is Authorised and regulated by the Financial Services Authority. FSA Register number 114059.

Where to Spread Bet on Capital Shopping Centres?

You can spread bet on Capital Shopping Centres with any of the following companies:

• Financial Spreads
• IG Index
• Paddypowertrader

Although note that you can also spread bet with other Spread Betting Companies.

Spread Betting on Capital Shopping Centres

Should you want to speculate on companies such as Capital Shopping Centres then one possibility could be to spread trade on the Capital Shopping Centres share price.

Looking at the Financial Spreads trading site, as of Friday, they were showing the Capital Shopping Centres Rolling Daily market at 382.4p – 383.2p. As a result, you could spread bet on the Capital Shopping Centres shares:

• Increasing above 383.2p, or
• Decreasing below 382.4p

When financial spread betting on UK equities you trade in £x per penny. So, if you chose to have a stake of £10 per penny and the Capital Shopping Centres shares move 5p then there would be a difference to your P&L of £50. £10 per penny x 5p = £50.

Rolling Daily Shares Markets

This is a Rolling Daily Market which means that there is no settlement date for this market. If a trade is still open when the markets close at the end of the day, it will stay open and roll over into the next trading session.

If you do let your bet roll over into the next day and are spread betting on the market to:

• Move higher – then you will pay a small overnight financing fee, or
• Move lower – then a small payment is normally credited to your account

Our article Rolling Daily Spread Betting goes into more detail about Rolling Daily Markets and includes a fully worked example.

Capital Shopping Centres Rolling Daily Shares Spread Betting Example

If you think about the above spread of 382.4p – 383.2p and make the assumptions that:

• you have analysed the markets, and
• you feel that the Capital Shopping Centres share price will move above 383.2p

then you could decide that you want to buy a spread bet at 383.2p for a stake of £5 per penny.

So, you win £5 for every penny that the Capital Shopping Centres shares increase and move higher than 383.2p. Nevertheless, you will make a loss of £5 for every penny that the Capital Shopping Centres market falls lower than 383.2p.

Thinking of this in a slightly different way, if you ‘Buy’ a spread bet then your profit/loss is found by taking the difference between the closing price of the market and the initial price you bought the market at. You then multiply that price difference by the stake.

Therefore, if after a few trading sessions the stock rose then you might want to close your position to lock in your profit.

So if the market rose then the spread, determined by the spread betting company, might change to 402.4p – 403.2p. To close your trade you would sell at 402.4p. As a result, with the same £5 stake your profit would be:

Profits (or losses) = (Settlement Price – Opening Price) x stake
Profits (or losses) = (402.4p – 383.2p) x £5 per penny stake
Profits (or losses) = 19.2p x £5 per penny stake
Profits (or losses) = £96.00 profit

Financial spread trading is not simple. In the above example, you had bet that the share price would rise. Of course, the share price can also go down.

If the Capital Shopping Centres shares had started to drop then you might decide to settle/close your spread bet to limit your losses.

So if the market dropped to 366.9p – 367.7p then you would settle your trade by selling at 366.9p. If so, this would result in a loss of:

Profits (or losses) = (Settlement Price – Opening Price) x stake
Profits (or losses) = (366.9p – 383.2p) x £5 per penny stake
Profits (or losses) = -16.3p x £5 per penny stake
Profits (or losses) = -£81.50 loss

Note: Capital Shopping Centres Rolling Daily spread correct as of 26-Nov-10.

Spread Betting Account Offers

If you are looking to open a spread betting account then for the latest spread betting offers please see Spread Betting Offers.

For a more detailed look at the spread betting markets, spread sizes and account services offered by a range of spread betting companies also see Spread Betting Account.

Spread betting carries a high level of risk to your capital. You may lose more than your initial investment. It may not be suitable for all investors. Only speculate with money that you can afford to lose. Please ensure you fully understand the risks involved and seek independent financial advice where necessary.

Where to Spread Bet on Cairn Energy?

You can spread bet on Cairn Energy with any of the following companies:

• Financial Spreads
• IG Index
• InterTrader

Although note that you can also spread bet with other Spread Betting Companies.

Cairn Energy Spread Betting – More Details

For more information on trading Cairn Energy, also see Cairn Energy Spread Betting.

Spread Betting on Cairn Energy

Should you want to speculate on UK listed companies like Cairn Energy then one option could be to spread bet on the Cairn Energy share price.

If you were to look at the InterTrader spread betting site, as of Friday, they were showing the Cairn Energy Rolling Daily market at 389.6p – 390.5p. Therefore, you can spread bet on the Cairn Energy shares:

• Rising above 390.5p, or
• Falling below 389.6p

When financial spread trading on UK equities you trade in £x per penny. So, if you decided to risk £10 per penny and the Cairn Energy share price changes by 5p then that would alter your P&L by £50. £10 per penny x 5p = £50.

Rolling Daily Shares Markets

One important thing to note is that this is a Rolling Daily Market and so there is no settlement date for this market. If you decide to leave your trade open at the end of the day, it just rolls over into the next day.

If a position is rolled over and you are speculating on the market to:

• Move higher – then you will normally be charged a small financing fee, or
• Move lower – then a small payment is usually credited to your account

To learn more about Rolling Daily Markets please see Rolling Daily Spread Betting.

Cairn Energy Rolling Daily Shares Trading Example

If you consider the spread of 389.6p – 390.5p and make the assumptions:

• you have done your market research, and
• you think that the Cairn Energy share price is likely to increase and move higher than 390.5p

then you may decide that you are going to buy at 390.5p for a stake of, for example, £5 per penny.

With such a spread bet you make a profit of £5 for every penny that the Cairn Energy shares increase and go above 390.5p. Nevertheless, you will make a loss of £5 for every penny that the Cairn Energy market decreases lower than 390.5p.

Put another way, if you were to ‘Buy’ a spread bet then your P&L is worked out by taking the difference between the closing price of the market and the initial price you bought the market at. You then multiply that price difference by your stake.

As a result, if the share price started to move upwards then you could choose to close your spread bet in order to guarantee your profit.

Taking this a step further, if the market rose then the spread, set by the spread trading company, might change to 406.1p – 407.0p. You would close your position by selling at 406.1p. As a result, with the same £5 stake you would make:

P&L = (Final Level – Opening Level) x stake
P&L = (406.1p – 390.5p) x £5 per penny stake
P&L = 15.6p x £5 per penny stake
P&L = £78.00 profit

Speculating on shares, whether by spread betting or not, is not simple. In the above example, you wanted the share price to increase. Naturally, it could go down.

If the Cairn Energy stock had fallen then you could choose to close your spread bet to limit your losses.

If the market fell to 372.0p – 372.9p then this means you would settle your spread bet by selling at 372.0p. So your loss would be calculated as:

P&L = (Final Level – Opening Level) x stake
P&L = (372.0p – 390.5p) x £5 per penny stake
P&L = -18.5p x £5 per penny stake
P&L = -£92.50 loss

Note: Cairn Energy Rolling Daily spread betting market taken as of 26-Nov-10.

Spread Betting Account Offers

If you are looking to open a spread betting account then for the latest spread betting offers please see Spread Betting Offers.

For a more detailed look at the spread betting markets, spread sizes and account services offered by a range of spread betting companies also see Spread Betting Account.

Spread betting carries a high level of risk to your capital. You may lose more than your initial investment. It may not be suitable for all investors. Only speculate with money that you can afford to lose. Please ensure you fully understand the risks involved and seek independent financial advice where necessary.

Financial Market Comments from Anthony Grech, Head of Research, IG Index.

In the early session the FTSE 100 has opened lower as events in Asia and Europe dampen sentiment.

London’s leading index looks to be rudderless this morning, as falls in the Asian markets, the lack of action in the US due to Thanksgiving and ongoing geopolitical anxieties continue to put investors off.

The miners are dragging the index lower, with sector heavy-hitters Vedanta (-3.55%), BHP Billiton (-3.10%) and Antofagasta (-3.20%) among the losers, as metal prices fall in the wake of speculation that China will take steps to curb inflation.

Among the winners BT (3.48%) finds itself up on the day, as Indian based Mahindra & Mahindra agrees to purchase a further 5.5% stake of their joint Tech Mahindra venture.

In Europe, the Euro finds itself under siege as fears that the European bailout crisis will intensify, with Spain and Portugal coming under the spotlight, causing traders to flock to more risk-adverse currencies.

That other elephant in the room, Korea, is also contributing to this mood, as Asian currencies continue to fall against the perceived safety of the Dollar. However, the UK market has proven to be fairly resilient, and has by no means bottomed out.

But with no major announcements out in the US this afternoon, it looks like a degree of anxiety over the market’s direction will continue into next week.

Spread betting carries a high level of risk to your capital. You may lose more than your initial investment. It may not be suitable for all investors. Only speculate with money that you can afford to lose. Please ensure you fully understand the risks involved and seek independent financial advice where necessary.

Good Luck!

DB

The above comments do not constitute investment advice and Clean Financial accepts no responsibility for any use that may be made of them.

Content provided by IG Index which is Authorised and regulated by the Financial Services Authority. FSA Register number 114059.