LONDON, July 13, 2012 /PRNewswire/ --
Peugeot shares fell 6% in early morning trade after the French car manufacturer reported a 13% fall in first-half sales this morning, Thursday 12 July.
However, through the City Index spread betting platform, the share price recovered to trade 27p higher than the previous day's close by 9:25 BST.
Unlike traditional trading, spread betting enables investors to trade on shares that are both rising and falling, with the potential to profit.
Below, we look at the news out of Peugeot and how you can trade on a share price that both rises and falls, with a City Index spread betting account.
Peugeot Impacted by Eurozone Crisis
Peugeot, the second-biggest car maker in Europe, reported a 13% fall in worldwide sales today for the first half of the year.
Vehicle sales fell from 1.86 million in the first half of 2011, to 1.62 million in the first half of 2012.
Their European sales fell by 15% and in a statement by the manufacturer; they stated that the cause of this decline was due to the crisis within the Eurozone: "The Peugeot and Citroen brands' traditionally strong markets - France, Spain and Italy - are in profound crisis."
The firm is now planning cost-cutting measures, which could see a factory close and thousands of staff laid off.
Trading Falling Shares
As mentioned above, unlike traditional trading - with a financial spread betting account, you can trade on a market that is both rising and falling, with the potential to profit.
Through the spread betting platform, the spread betting prices track the underlying instrument. Therefore, if you want to spread bet the future price movement of Peugeot shares, you would trade on the 'Peugeot Citroen DFT'.
When disappointing sales figures were reported early this morning, the market reacted negatively, with the share price dropping by 22.7pence between 8:10 and 8:55 BST on the spread betting platform.
At this stage in trading those investors who had gone short and sold the Peugeot Citroen DFT would have profited with each pence the share fell.
However, they would have incurred losses as the share started to recover as of 8:40 BST.
At this stage, those investors who would have gone long and bought the Peugeot DFT; would have seen their profits rise in line with each pence that the company's share price rose.
Tip: As a leveraged product you can incur losses greater than your initial deposit.
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About City Index:
Today more and more individual traders are discovering the benefits of derivatives, and many of them are discovering them through a City Index trading platform.
As a group, we transact in excess of 1.5 million trades every month in over 50 countries. We provide access to a wide range of instruments including margined foreign exchange, CFDs and, in the UK, financial spread betting.
We constantly look to improve the performance of our platforms and expand our range of services. The result is our customers benefit from innovative trading tools with transparent pricing, competitive spreads, and a high standard of customer support. Visit http://www.cityindex.co.uk/ for details.
Spread betting is exempt from UK stamp duty and Capital Gains Tax. However, tax laws are subject to change and depend on individual circumstances. Please seek independent advice if necessary.
SOURCE City Index