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How to Spread Bet on AstraZeneca as Share Price Falls with City Index

LONDON April 27, 2012

26 April 2012 David Brenna

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Another blow for AstraZeneca

As recently as March this year, AstraZeneca pulled the plug on a potential anti-depressant drug, costing them £31m in losses.

Only last week, Brennan – who has worked at the helm of Astra for six years – dismissed suggestions that investors were growing restless with the way he was managing the business, with intentions of ousting him.

However, Brennan is now in the press stating that his decision to step down was "totally" his own and that he had in fact been "considering it for a while".

He further clarified: "It was time to give somebody the chance to take the company to the next level. It was my decision."

London 26 April 2012

How to Spread Bet on AstraZenaca Shares

With the share price falling; those spread betting are given the opportunity to profit.

spread bet market

Your profits will rise in line with any increase or decrease, respectively, in that price – however, your losses will also increase if the market moves against your position.

Looking at AstraZenaca shares; say for example that it is 18 April. With recent bad news – as seen above – from the company, investors may be looking to take a position on the firm’s future share price movement.

They believe that there may be more bad news in the near future for the market, so they choose to go short and sell.

City Index

An investor decides to short sell a spread bet of £10 per point.

June 1 st

As the investor had predicted, this makes for another blow to the company’s share price and the market falls even further.

At this stage, the investor decides to cash in. The market has now fallen 15 points from its original position, so they buy back at the new buy price of 2717.34.

Therefore, they profit £150 tax free* (2732.34-2717.34 x £10 = £150).

Start Spread Betting

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Remember, as a leveraged product, spread betting comes with high levels of risk and can result in losses greater than your initial deposit.

*In the UK, all gains made in a financial spread bet are currently free from UK Capital Gains Tax. However, UK Tax laws are subject to change and may differ depending on your personal circumstances.

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.

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We constantly look to improve the performance of our platforms and expand our range of services. The result is that our customers benefit from innovative trading tools with transparent pricing, competitive spreads, and a high standard of customer support.

SOURCE City Index

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