PRN: Spread Bet FTSE 100 Following 2% Fall in Morrison's Share Price
Spread Bet FTSE 100 Following 2% Fall in Morrison's Share Price
LONDON, June 26, 2012 /PRNewswire/ --
Following the announcement of the planned departure of the group's Finance Director, the British supermarket experienced a fall of 2.45% on the FTSE 100.
Below, we look at what happened and how you can potentially profit from not only gains but falls in a market with financial spread betting.
Morrisons Finance Director Checks Out
It was announced this morning (Monday, June 25) that Richard Pennycook, a highly regarded finance director, had resigned from WM Morrison Supermarkets PLC.
His departure is planned for June 2013, whereby he will pursue a portfolio of roles.
Whilst this sent shockwaves through the market in early morning trading today, it should not come as a great surprise since Pennycook lost out twice for the chief executive role at Morrison over the past two years.
This, however, is not the first blow for the UK's fourth largest supermarket chain by market share; recent industry data showed that its sales growth had stalled.
Furthermore, only last week, Sir Ken Morrison criticised the retailer for moving too upmarket - having launched the chain originally from a few market stalls in Bradford, UK.
Spread Betting on a Falling Market
As of 9:24 BST, WM Morrison Supermarkets PLC shares fell 2.45% on the FTSE 100 index.
Whilst this fall could negatively impact investors trading shares on the FTSE 100, others who had chosen to spread bet the popular indices market could have potentially profited.
As an alternative to more traditional forms of trading, financial spread betting enables investors to go long or short on over 12,000 financial markets - including the FTSE 100.
For example, if you believe the FTSE 100 will rise - you go long and buy.
Alternatively, if you believe it will fall - you go short and sell.
In this event, let's say you went short and sold and the FTSE 100 fell, you would profit for each point the market moved in your favour.
However, if the market had moved against your position - you could incur a loss greater than your initial deposit, making risk management imperative to your spread betting strategy.
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