Slater & Gordon Potential Speculation Trade.
For this trade to go ahead I require two conditions:
1.= 2-3 weeks out from the interim report release
2.= share price to be at support of 0.23 (if it hits earlier i will not buy but wait till two weeks before release and then buy depending how the technical s look for support. If its dropping and not making new support I wont buy)
I will be opening a CFD on this rather then buying actual shares because:
1. More liquidity
2. This stock is not paying dividends and its a short term trade. Id rather use leveraged equity and keep my cash free for other investments.
The only thing to move this stock upwards will be a positive interim report. Until then this is all market noise.
Id be wary of entering too soon because after that McGrath report came out the stock has not recovered from losses since. Also, when someone describes that a business is in "fair shape" it is not 'good shape'. I don't like the vibe that word has. I have also noticed a lot of alarming problems fundamentally with Slater and Gordon such as falling profit margins over the past 9 years, increases in Bad and Doubtful Debt Expense by 239% when revenue increased 72% and a few other things ruling this out as a long term stock buy for me. This is not an investment. It is a speculation trade.
I consider this trade as high risk as it gets but, given the potential upside should the interim report provide some positive indications I take it as a calculated risk.
