Trade Drax Group Shares

Drax Group (DRX.L)

About

Drax Power Limited is the operating subsidiary of Drax Group plc and the owner and operator of Drax Power Station, the largest, cleanest and most efficient coal-fired power station in the UK.

Industry

Electricity

Website

www.draxgroup.plc.uk

Trading Options

Financial Spread Betting
Contracts For Difference
Share Dealing / Stockbroker

Drax Group and Market Latest News

Yahoo! Finance: DRX.L News
UK to fix biomass energy support for 20 yrs (Reuters MOLT)
London close: BP rally lifts Footsie (ShareCast)
BP was in the driving seat, helping Footsie to good gains as the oil giant's shares rallied on the back of bid talk and hopes that the beginning of the end of the Gulf of Mexico oil leak is in sight.
London midday: BP a bright spot in lacklustre Footsie (ShareCast)
Shares in BP have jumped on takeover talk and hopes that it is making progress as it caps the oil leak in the Gulf of Mexico, but Footsie is little changed overall.
A Powerful Sector
Power generation and utilities companies occupy a pretty impregnable niche, but competition between them is fierce.
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Drax Group: Financial Spread Betting vs CFD vs Share Dealing

Table below compares Financial Spread Betting, Contract For Difference and Share Dealing trading. For simplicity we use the average brokerage fees to calculate the profit/loss if £1,000 available for investment in Drax Group shares (Drax Group share price is 650p). Supposedly, you think that Drax Group shares will go up by 10% in one month.

Calculations

Spread Betting

CFD

Share

Number of Shares Equivalent

3,077

3,077

154

Shares go up by 10% in 1 month, Gross Profit

£2,000

£2,000

£100

Commission to open position (buy)

£60

£15

£12

Commission to close position (sell)

£0

£15

£12

Total Commission

£60

£30

£24

Financing for one month (5% LIBOR rate)

£108

£108

£0

Tax (20% band)

£0

£372

£15 + £5 (Stamp Duty)

Net Profit

£1,832

£1,490

£56


Drax Group: Financial Spread Betting and Contracts For Difference (CFDs) are margined (or leveraged) products and let you go long (buy) or short (sell) with Drax Group shares, they are more suitable for short and medium term investments and cover a wide range of markets, including shares, indices, commodities and currencies. Share investing, on the other hand, is a conservative and old way of gaining financial independence and preserving capital. Even though some stockbrokers offer credit facilities it is very rare and not popular amongst private investors.

Risk Warning: Financial Spread Betting and Contracts For Difference (CFDs) are leveraged products and carry a high level of risk to your capital. You may lose more than your initial investment. Share price can go down as well as up and returns on investments are not guaranteed.