How to buy and short Cineworld shares

How to trade Cineworld shares

They sound similar, but investing in and buying Cineworld shares are two different concepts. When you buy shares, you don’t actually own any underlying assets – you’re trading on the share price, usually with contracts for difference (CFDs). With us you can only buy Cineworld shares, you cannot `invest´ in them.

If you invested in Cineworld shares, you would be paying for the total amount of shares you wished to own upfront. If you decide to buy the same number of shares with CFDs, you’ll only need a fraction of the capital to do so.

Follow the steps below to buy Cineworld shares:

Trading derivatives with CFDs will allow you to:

• Get full exposure with a small deposit – usually just 20%-25% of the full value of the trade¹
• Hedge your positions with CFDs and offset losses against potential profits²

Open an account now to get started

How to short Cineworld shares

‘Selling’ relates to investing and ‘shorting’ to trading. Let’s take a closer look at the differences.

If you owned Cineworld shares, there might come a time when you wanted to sell them. If the share price was higher than what you had paid for them, you’d make a profit. If it was lower, you would cut a loss.

If you think the share price is going to fall, you can short shares using CFDs. If the share price drops and you’ve taken a short position, you’ll make a profit.

Here’s how to short Cineworld shares with IG:

Shorting Cineworld shares

1. Create or log in to your trading account and go to our trading platform
2. Type ‘Cineworld’ in the search bar and select it
3. Choose your position size
4. Click ‘sell’ in the deal ticket
5. Confirm and monitor your short position

Cineworld’s live market prices

Cineworld shares: the basics

Founded in 1995, Cineworld Group has been listed on the London Stock Exchange (LSE) since May 2007. You’ll find Cineworld listed under the ‘CINE’ ticker.

Headquartered in Brentford, UK, Cineworld operates in ten territories worldwide, with the US delivering the bulk of the company’s revenue. As of 31 December 2019, they have 9500 screens at 787 sites and just under 38,000 employees.³

The entertainment industry has been one of the hardest hit by the coronavirus pandemic – and Cineworld is no exception. The company’s share price has dropped drastically since the start of 2020, reaching its lowest point on 17 March, closing on 21p on the day. This coincides with the rapid spread of the Covid-19 virus and the subsequent lockdown measures instituted by the countries where Cineworld operates.

What is Cineworld’s business model?

Cineworld’s main business is its cinema branch, but the company is also involved in the retail, software development, advertising and gift promotion sectors. The company’s main aim is to drive customers to watch feature films at their cinemas. In doing so, it gains more revenue through retail sales of food and drink, and through advertising on screens.

In each of its territories, Cineworld operates under a different brand of cinema chains. In the US, there are 546 Regal cinema sites, making this its largest operation. Its other cinema brands are Cineworld, Picturehouse Cinemas, Cinema City, and Yes Planet. These operate in the UK and Ireland, Czech Republic, Poland, Hungary, Slovakia, Romania, Bulgaria and Israel.

Cineworld announced plans in December 2019 to buy Canadian rival Cineplex. If concluded, the deal would see Cineworld become the largest cinema operator in North America. However, the acquisition has been abandoned, resulting in ongoing legal battles between the two companies.

Cineworld key personnel: who manages the company?

Cineworld’s board consists of 11 members:

How to analyse Cineworld’s share price

To analyse Cineworld’s share price performance, you’ll want to use both fundamental and technical analysis.

Fundamental analysis looks at macroeconomic factors that can affect a share’s price, like inflation. It also looks at microeconomic factors, like the costs of production and supply and demand. The purpose of fundamental analysis is to determine if a company’s share price is over- or under-priced.

The most common fundamental analysis techniques you might use to analyse Cineworld’s share price include the price-to-earnings ratio (P/E ratio), return on equity (ROE), and earnings per share (EPS).

Technical analysis uses historical data and technical indicators to identify patterns in the market. The purpose of technical analysis is to predict the future direction of a company’s share price.

When conducting technical analysis on Cineworld shares, you might look at parabolic SAR, moving averages, and the relative strength index (RSI).

Buying Cineworld shares summed up

• You can buy Cineworld shares without owning any underlying assets
• Short Cineworld shares via our platform if you think the share price will fall
• You can use fundamental analysis to determine if the share price is over- or under-priced
• Technical analysis can be used to predict the future direction of Cineworld’s share price

Footnotes

¹Deposits on leveraged trades are 20%-25% for 99.14% of tier-one shares (correct as of 1 June 2020). For more information, view our share trading margin rates
²Tax laws are subject to change and depend on individual circumstances. Tax law may differ in a jurisdiction other than the UK
³Cineworld, 2020