- Rolls-Royce rights issue could create volatility for traders to exploit
- Opportunity to trade from key support level of 100p a share
Few brands in the world are as well-known as Rolls-Royce, a legacy of its long heritage in luxury cars. What is less widely known is that Rolls-Royce is now no longer involved in the automotive business, which was demerged from the group in 1973. Now the business is largely focused on the development and manufacturing of aero engines as well as providing aftermarket service.
Given that flying has taken a back seat in 2020 it is little surprise that the shares have had a terrible pandemic, collapsing from around 700p to a low of 101p last week. To shore up its finances the company recently announced a rights issue that will offer all shareholders the opportunity to participate in the company’s fundraising.