To trade BAE Systems shares you can either use a traditional stock brokerage firm (such as IG) or you can use a CFD service, such as LCG We'll explore the pros and cons of both approaches in a moment.
Currently, IG charge a minimum of £5* per trade for buying and selling shares online, while LCG take a fee from the spreadThe spread is the difference (in pips) between the buy price and the sell price.
Example: If the current buy price of EURUSD is 1.0004 and the sell price is 1.0003, there is a 1 pip spread. for stocks such as BA
Pros & Cons of Trading BAE Systems shares (BA) as a CFD
A CFD (or 'contract for difference') is a way of trading instruments like shares without having to own the shares. Here are some of the pros and cons of CFD trading compared to using a traditional stock brokerage.
- The main advantage of a CFD broker is the leverage they offer their clients. This means that a trader would require a much smaller account sizes relative to the size of a trade in comparison to a traditional share dealing broker.
At the current price of £464.10 per share, to buy 50BAE Systems shares with no leverage, it would cost a total of £23,205.00 £23,205. However, using leverage of 1:33, a trader would only require an account size of £1,498.66 £703 to place the trade with a CFD broker.
- CFD brokers allow traders to go long or short, which means a trader could benefit from rising and falling markets.
- CFD brokers usually do not charge a commission and instead have their fees included in the spread.
- CFD brokers like AvaTrade that offer the MT4 platform, allow clients to use expert advisors to automate their trading strategies.
- UK shares that are purchased as a CFD are not liable for the usual 0.5% stamp duty payable with a traditional share purchase (please note that tax laws can change and are subject to individual circumstances).
- Unlike traditional brokerages that only offer stock trading, CFD brokers like LCG give access to a wide variety of instruments like stocks, commodities and currencies.
- As mentioned, leverage is a double-edged sword that can magnify both gains and losses. And as with all trading, traders are at the risk of the markets moving against them.
- CFD brokers typically charge an overnight fee for holding a long position overnight. This is essentially the cost of borrowing the money from the broker to purchase the shares on margin. There would be no overnight fee if you closed the position on the same trading day. Therefore, this would only be a disadvantage if you are not a day trader or intraday trader.
For example, LCG currently charge an overnight financing fee of 2.73% for individual equities. This means that for the example trade above, it would cost a trader £1.73 every day the position was open.
For further information on trading stocks as a CFD, visit out "trading stocks as a CFD page". It is important to remember leverage can work both ways and magnify gains and losses.
*All information collected from https://www.lcg.com/uk/, see website for full terms and conditions. Your capital is at risk. Last updated on 20th March, 2017.
BAE Systems: Key Stats & Background Information
BAE Systemsshares are currently priced at
£464.10, after opening the day at
£462.70. As of
BAE Systems have
3,202 million shares available, bringing their market capMarketing capitalisation is the value of a publicly traded company, calculated by multiplying the current share price by the total number of shares available. to
This market cap makes BAE Systems the 33rd largest stock on the FTSE 100 index by market capitalisation. In the past 30 days, the BAE Systems share price has decreased by -5.88%, from £493.10. In the past 90 days, it has ' ; decreased by -0.15%, from £464.80 to the current price of £464.10.
In terms of trading activity BAE Systems is the 19th most actively traded stock in the FTSE100, with an average of 2,045,802 shares being traded per day.
BAE Systems had a profitafter tax for the financial year ending 30/06/2016of £943 million, an increase from £752 million for the financial year ending 30/06/2015, an overall 25% change in profit after tax.
BAE Systems was listed on the London Stock Exchange on
February 11, 1981, and can be traded on Monday-Friday between 8am and 4.30pm GMT (UK time).
BAE Systems paid a dividend of 20.70p in 2016, an increase from 20.30p in 2015.
Top 10 FTSE 100 Companies by Trading Volume
|Lloyds Banking Group PLC||48,564,260|
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Top 10 FTSE 100 Companies by Market Cap
|Royal Dutch Shell Plc||£234,574,796,465|
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Comparison of BAE Systems's EPS & P/E Ratio with other Aerospace & Defense companies
BAE Systems has a price/earnings ratio of 12.43. For comparison, Rolls-Royce Holding's P/E ratio is 22.17 and GKN's P/E ratio is 11.09. BAE Systems's basic earning per share from continuing operations for the 30/06/2016 financial year was 29.00p, which was an increase from the previous financial year of 20.92p.
|Company||Basic - EPS||P/E Ratio||Market Cap (Million)|
|BAE Systems ( LON:BA)||29.00p||12.43||£14,862|
|Rolls-Royce Holding ( LON:RR)||-220.08||22.17||£17,457|
|GKN ( LON:GKN)||11.80||11.09||#N/A|
*Information is provided "as is" and solely for informational purposes, not for trading purposes or advice, and may be delayed.