So going back to another topic raised. This is when you definitely don’t want to have a spreadbet position open as who know what can happen over the weekend. How many times did we see RR back in 2021 drop 20-30p on the open but then recover. Those drops were triggering all stop losses or putting people into their margins.
That can still happen now but if it did I’d guess it would be very quickly bought up again so rather than a retracement I would call it a flash crash.
One thing to note. RR was 10% down from its ath when it hit mid 390 today so it has had some retracement already.
Ran out of room so typing again.
I’m in no way promoting spreadbet as if your going to do it then your going to do it. But I’m presenting both sides, it’s not all up and up and you can lose your whole capital quickly. But if you’re happy to take a risk early on it can set your isa up very nicely.
On the flip side you can still lose your capital with ISA. Investing is a risk and one poses more risk than the other.
Over and out! :) have a happy Friday.
To clarify, I’m no longer spreadbetting and have noted numerous times of the risks involved in over exposing. If you don’t over expose and have a good capital the gains can far outweigh that over a normal isa investment (albeit more risk but more reward).
You can still invest in this over a period of months to ride out dips but will incur small fees for doing so.
It all depends on your risk appetite and how much time you actually have to study all aspects.
For me personally, I feel Rolls Royce is now higher risk for spreadbetting as the swings on a points/pip basis can be far greater. When the s.p was at 110 range and we have those volatile days a 20% drop would be around 22 points/pips.
We can see the same at the current share price with around 4% so the value of spreadbet for me drops and the risk increases.
To conclude, if you are a full time day trader and decent then I’m sure you are profitable but (this is the key aspect) if you are spreadbetting and you got a good run IT WILL NOT CONTINUE so be sure to take profits and lock them into savings/isa if you have the allowance.
The biggest issue with spreadbet is when you make more every number grows and that includes your exposure and risk. This is natural when you’re inexperienced and it will only take one big drop for you to be under pressure and near or close to your margin.
My personal reason for spreadbet is because I wanted the exposure whilst y capital was low it effectively really didn’t matter if I’d lost it. Even with rolls increased 400% if I’d put my capital into an isa I would have never made anywhere near the gains I had. But I did have to endure more stress.
Now I’ve made a nice amount I can lower my risk and exposure and lock into isa.
You have to analyse what you want to gain from it. ISA is a very long term play and more often than not set up for retirement unless you hit jackpot with a couple to enjoy your money.
Spreadbet can give you quick gains but also quick loses which you may be forced take.
Il lead with an example.
ISA - £10,000 to invest. To make £5,000 a company would need to increase by 50%.
Spreadbet - £10,000 to invest so you pick Lloyds. It’s low on volatility and as a daily price movement of 4-5 points. You can then go £500 per point which requires a capital of only £5000 but leaves you with the other £5k as a buffer.
You can make gains as quick as you can lose them but this would require an ISA investment of around £45-£50k which you may not have.
Once you make (hopefully) good gains then lock them into your isa and you’ve done the hard part. Don’t leave your capital in your spreadbet as you will natural increase your exposure and could be in at say £2,000 per point which would only need a 10pm if drop to lose your capital. And if it’s in there it probably will happen if your in experienced and greed grabs ahold of you. Lock it away and start again if you wish.
Just think about it c
Peakdread: yes I do believe that the share price is justified but after a massive increase I don’t think a 20% retrace meant would be a negative. ( as I said I don’t think it will happen) but not impossible. That’s just the major support/consolidation we last had.
Just because a company is undervalued and has massive potential it doesn’t mean that it just goes up and up. :)
I’m not sure what your point is. I have de risked my spreadbet and just have my isa. My point is that if people on here are looking to invest I think it may be worth watching over the next few days/weeks.
This may be in a consolidation zone with dips below the 400 mark.
Not a bear but for people looking to invest it is worth watching. Supports around 390 and 380 but then it gets interesting because there isn’t much to offer until you get to 320 (where that would close a gap) and then 300 after that.
I don’t imagine it going that low by any stretch of the imagination but anything is possible over a short term.
As this stocks grown so much a 20% correction from this level equates to a lot more than what people are used to now. 20% takes you down to 320 ish.
Just an observation for investors that haven’t yet pressed the button and to set alerts.
Equally nothing to stop this from hitting new ATH imminently.
Yeh I see your point too, and you’re right, there’s no negativity surrounding the stock either. See more orders may be on the horizon this morning with Indigo airlines too. Not confirmed yet though.
Yeh we know where it’s going but I just didn’t anticipate how quickly it’s on its way.
Sounds like I’m moaning, I’m not. Merely playing devils advocate, if I was a new investor investing in at ATH and not seen any pullback for entry in the last x-weeks/months it can be quite difficult to buy in from that perspective.
Obviously they would strategise average down.
Good points there. When I talk about corrections I’m not referring to bad news either. Even healthy profit taking has been minimal. I get why people wouldn’t see obviously. Also, yes there has been more good new yesterday so short term probably no reason for any pull back.
Please note: this is no de-ramp or scare mongering.
This stock is literally booming and has had such a good run but I can’t help but think ‘where is the correction?’ We all know stocks don’t just go up and up without corrections. We’ve seen some consolidations but no real corrections yet. And that’s regardless of how much it’s potentially undervalued but the last small pull back was in September 2023. Since then we have only had 3 minor red candles on the weekly.
Svend, you’re a chartist. What’s your thoughts? You must have pictured something?
Woken by my little one so thought I’d read Fitches last upgrade on Rolls. For them to upgrade rolls rolls to investment grade they’re looking for rolls to reach a gross ebitda below 2x but preferably closer to 1. This is inline with other investment grade companies.
Rolls ebitda as of fitch’s last upgrade was below 3x at 2.29. I believe. So it’s close.
This has been their business model since the beginning of time. Only difference now being they are also charging for engines as well as increased servicing costs.
Yeh I’m involved in the blog, your work is great so please keep it up.
I’ve been delving into AI stocks lately, missed out on Micron this evening. Finding it hard to find new stocks to invest in at the minute.
It’s on spreadbet and as you know it’s always good to re risk. I can always get back in tomorrow if I see it looks ok but thought I might see some profit taking. My isa is still going though. 👍🤞