Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 75% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money. Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.

Bushveld Minerals climbs 6% as investors look for growth stocks

The producer of vanadium saw its share price soar on Monday after announcing it is ramping up to full production last week and investors hunt for growth stocks amid the Covid-19 crisis.

Bushveld Minerals saw its share price close more than 6% higher on Monday after announcing it is ramping up to full production last week, with investors on the hunt for growth stocks amid the Covid-19 crisis.

The producer of vanadium has told investors that despite challenging market conditions, it remains on track to meet its 2024 target of 8400 tonnes of production.

‘We used the lockdown period to strengthen our health and safety protocols together with business continuity measures, conducted maintenance and processed intermediary stockpiles, as per the guidelines received from our authorities,’ Bushveld Minerals chief executive officer (CEO) Fortune Mojapelo said.

‘We are pleased that both Vametco and Vanchem are safely increasing production to normal levels,’ he added.

Not only is production looking strong, but the company’s balance sheet remains healthy despite the challenging environment, with the business establishing cash preservation measures to manage near-term liquidity, while preserving the long-term sustainability of its assets.

The company continues to review and limit operational expenditure where necessary as well as deferring growth associated (non-critical) capital expenditure.

Bushveld Minerals closed at 13p per share on Monday.

Bushveld Minerals 2020 outlook remains unclear

The 2020 production and cost guidance for both Vanchem and Vametco remains under review and will remain so until the company is in a position to quantify the impact of the Covid-19 pandemic and the South African nationwide lockdown, the company said in its first-quarter (Q1) trading update.

‘This update comes in the midst of the global Covid-19 pandemic that has not only changed our world but will continue to change it in ways we have not fully understood yet,’ Mojapelo said.

‘I am pleased that these difficult circumstances found Bushveld Minerals in a sound state financially, with a set of quality low-cost production assets,’ he added.

Despite the impact of Covid-19 crisis, the vanadium price has been resilient. China's Purchasing Manufacturing Index indicated improved rebar production and demand driven by the restart in the construction sector, with China's rebar consumption tracking up 10% year-on-year (YoY) as well as the country being a net vanadium importer during the month of March.

‘Looking ahead we expect vanadium demand to remain robust in the medium to long term spurred on by supportive fiscal stimulus and increased infrastructure investments,’ the company said.

The optimism surrounding Bushveld Minerals remains high among analysts too, with Peel Hunt reiterating its ‘buy’ rating for the stock in May.

How much does it cost to buy UK shares with IG?

There are three ways to ‘buy’ UK shares with IG: spread betting, trading CFDs or buying physical shares. The cost will depend on which method you choose. The table below illustrates how the costs to get exposure to £10,000 of Lloyds stock, which is equivalent to 16,000 shares (quoted at 62.5p a share).

Remember, spread bets and CFDs are derivatives, which come with higher risk and reward than investing.

Cost to get exposure to Lloyds stock

Spread betting CFD trading Share dealing
Action Buy £160 per point Buy 16,000 share CFDs Buy 16,000 shares
Capital required to open £2000 £2000 £10,000
Total fees £20.88 £20.88 £16

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Note: Amounts do not include overnight funding charges and taxes. Spread bets are not subject to tax. CFDs are free from stamp duty, but subject to capital gains tax. Share dealing is subject to both stamp duty and capital gains tax.

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

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