Spread Bet British Land Company PLC
British Land Company PLC [BLND] is a large property development and investment company, headquartered in London. It was originally founded in 1856, and started as a freehold land company facilitating the sale of lands to the public. Towards the end of the 19th century it started to operate as an ordinary property development company, such as we recognize today. The Real Estate Investment Trust (REIT) is the UK’s biggest boasting over 28 million square feet of retail space and excellent locations mostly centred around London. The REIT is presently benefiting from a high levels of occupancy and a satisfactory level of new lettings, renewals and extensions which make the company look attractive for this £5 billion market cap.
As you can imagine, being in the property business has been a rough ride over recent years. Here is a daily chart: –
British Land Company Rolling Daily
As the name suggests, the British Land Company PLC is a property investment and development company, and consequently its share price has been volatile, particularly in recent years. The current price for a rolling daily spread bet on this company is 483.52 – 484.48. If you think that the shares are overvalued and will soon fall, then you may place a short bet on this stock. Say you stake £15 per point at the selling price of 483.52.
Assume first that you are correct, and that the price goes down. You may choose to take your winnings when the quote gets down to 446.73 – 447.69. The opening price was 483.52, and the closing price was 447.69, which means you have gained 35.83 points. As you chose £15 per point, this means you have won £537.45.
Some of the time your bets will not succeed, and you will be faced with having to close them at a loss, rather than risk the price going against you still further, for a bigger loss. Say the price went up to 511.14 – 512.10, and you chose to cut your losses by closing the trade. The point difference would be 512.10 minus 483.52, which is 28.58. At your chosen stake, that amounts to £428.70.
One of the secrets to making a profit from trading is to keep any losses small, so that they do not set back your account too much. A popular way to do this is with a stop loss order, which requires your spread betting provider to close the spread trade when a certain level of loss is reached. Say you set a stop loss on this trade, and it closed your spread bet when the price was 503.68 – 504.64. You have kept your losses down – you lost 504.64 minus 483.52 points, which is 21.12 points and costs you £316.80.
British Land Company Futures Based Spread Bet
British Land Company has a volatile pricing, and can give you good profits if you spreadbet in the right direction. If you are planning to hold onto your spread bet for more than a few weeks, because you feel that the medium-term will show some movement, you may want to use the futures based prices. The current quote for the furthest quarter, with an expiration date currently eight months away, is 484.94 – 490.79.
If you think that the stock is headed downward, you may want to place a short bet at a value of £20 per point. This would go on at the selling price of 484.94. If you are correct and the price does fall, then you would look for the position where you think the price has stopped going down, as you should try to maximize your gains, and then close your spread bet to lock in your winnings.
Say you close your trade when the quote is 421.63 – 426.21. The sell bet would close at 426.21, the buying price. This means that you have gained 484.94 minus 426.21, which is 58.73 points. At £20 per point, that is a win of £1174.60.
On the other hand, the price might have gone up after you placed your trade, and you may have closed your losing bet when the quote was 536.93 – 540.90. The number of points against you is 540.90 less 484.94, which is 55.96 points. This losing trade would cost you £1119.20.
It is frequently a good idea to set a stoploss order to close a losing trade before it becomes too large. This saves you having to watch the price all the time, and helps prevent large losses. Say that your stoploss order closed the spread bet for you when the price was 513.62 – 518.48. In this case you would have lost 518.48-484.94 points, which is 33.54 points. For your chosen level of stake, this would cost £670.80.
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