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Opportunities in new defence spending

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odysseus2000
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Opportunities in new defence spending

#358102

Postby odysseus2000 » November 19th, 2020, 2:40 pm

The PM has announced a new defence spending program with £16.5 billion of extra cash:

https://news.sky.com/story/boris-johnso ... t-12136302

This includes many goals including:

UK rocket launches from Scotland by 2022

Creation of a Space Force

Increase in cyber military capability

etc etc

If this happens who might benefit from this spending, what companies etc.?

Regards,

Lootman
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Re: Opportunities in new defence spending

#358104

Postby Lootman » November 19th, 2020, 2:46 pm

The usual suspects: I hold Raytheon, General Dynamics, Lockheed and Northrop Grumman.

Every time there is an escalation of tension somewhere like the Middle East, these shares get a nice bounce. I will hold forever because war never goes out of fashion.

There are also defence ETFs out there for those who like the theme.

Adamski
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Re: Opportunities in new defence spending

#358106

Postby Adamski » November 19th, 2020, 2:52 pm

BAE systems up 2% today, 28% up on 29 October. Maybe news was leaked, known about, as suspicious up a third over 2-3 weeks prior to announcement.

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Re: Opportunities in new defence spending

#358110

Postby dealtn » November 19th, 2020, 3:24 pm

Adamski wrote:BAE systems up 2% today, 28% up on 29 October. Maybe news was leaked, known about, as suspicious up a third over 2-3 weeks prior to announcement.


That looks very close to cherry picking the rise since the lowest recent point on the BAE chart.

Why be that specific? Let's say a month, during which time the wider market has jumped significantly on the back of vaccine news. Looked that way the FTSE100 is up 7.5% whilst BA. is up about 5.5%

If you want to have suspicions about possible leaks you might wish to consider a period of a week, or less. BA. may be up on such a timescale against a generally lower market, but by a much lower quantum than you suggest I would say.

Lootman
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Re: Opportunities in new defence spending

#358132

Postby Lootman » November 19th, 2020, 4:57 pm

dealtn wrote:If you want to have suspicions about possible leaks you might wish to consider a period of a week, or less.

Leaks and insider trading are usually manifested in increased options activity and a skewed put-to-call ratio.

Options are the best way of making a short-term directional bet on a share, whilst laying out and risking the minimum capital. Less transparent as well.

odysseus2000
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Re: Opportunities in new defence spending

#396155

Postby odysseus2000 » March 16th, 2021, 1:42 pm

More details on the UK defence direction and spending:

https://www.thesun.co.uk/news/14356304/ ... rce=pushly

Regards,


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