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Founded in 1968 by Robert Noyce and Gordon Moore, Intel Corporation (ticker: INTC) is a US multinational organisation headquartered in California. The company’s first sale was an order from Hamilton Electro Sales in mid-1969, with the 1970s seeing strong growth for the company and transforming into one of the largest organisations in the technology industry. Fast forward to today, Intel remains among the industry leaders in the technology sector.
With a global workforce of over 130,000, the company’s primary operations consist of manufacturing, designing, and selling semiconductor computer circuits. In its Q2 24 earnings release, the company noted: ‘By embedding intelligence in the cloud, network, edge and every kind of computing device, we unleash the potential of data to transform business and society for the better’.
Contracts for Differences (CFDs) are a cost-effective method of trading in global markets. They involve contracts between two parties to exchange the difference between a trading position’s opening and closing prices.
Unlike futures and options contracts, CFDs are cash-settled transactions. Whether one trades Commodities, Bonds, Currencies (Forex), ETFs (Exchange-Traded Funds), or Stocks, each trade is settled in cash; this means physical delivery of the underlying asset is not an option.
Another key observation is that all CFD trades are derivatives. If you were to buy (enter long) an Intel Share CFD with FP Markets, you would be trading the underlying price movement, and your account equity would reflect the stock's performance. There are no ownership rights with CFDs; to become a part owner in the company, one must purchase physical shares of Intel.
Finally, CFDs are leveraged financial instruments, meaning that a CFD trader can employ leverage using margin. By way of an example, purchasing 100 physical shares of Intel at a share price of US$100 would mean an upfront investment of US$10,000 (this would be an unleveraged position). However, investing in an Intel CFD with FP Markets has a margin requirement of 5%. So, instead of paying US$10,000 upfront, the CFD trader would only be required to ‘deposit’ 5% of the total position value: US$500 (10,000 * 0.05), permitting the trader to trade a position size equivalent to US$10,000.
1. Open an FP Markets Forex and CFD Trading Account
Opening a trading account with FP Markets is a simple process and is often approved in a few hours. Click on the ‘OPEN LIVE’ tab at the upper right side of the main web page and complete the five-stage application, as shown below.
2. Download your Trading Platform
With FP Markets, you can trade Intel Share CFDs on MetaTrader 5 (MT5) and cTrader. For this article, it is assumed that you will be using MT5.
Upon approval of your FP Markets trading account, you will receive your login details through your registered email address. Following this, you can access the FP Markets Client Portal, which offers several services and features, including the Platforms section, which allows clients to download your chosen trading platform.
3. Find the Intel Ticker
To locate the Intel Share CFD in MT5, open the Market Watch by pressing Ctrl+M.
Using the ‘click to add’ function, type ‘Intel’ and select the Intel stock. This will subsequently create an additional row in your Market Watch, such that you can now drag and drop the security to the chart’s interface on the right side, as demonstrated below. You can then adjust the chart’s settings to your trading preferences, such as chart type – candles or bars, for example – chart colour, technical indicators, drawing tools, etc.
4. Place the Buy or Sell Order
Once you have access to real-time prices for stocks of interest and have conducted research according to your investment strategy (which usually includes a mix of technical and fundamental analysis), buying and selling Share CFDs with FP Markets is straightforward.
As illustrated below, most traders press F9 to open MT5’s order window. With the Intel symbol selected, you can input your trading values, like the type of order – Market or Pending – volume, stop-loss value and take-profit orders.
Some traders, particularly short-term traders such as scalpers, execute trades using the ‘One-Click Trading’ feature (Alt+T). Without secondary confirmation, One-Click Trading allows traders to open trades rapidly, inputting only the trading volume (see below). However, one of the drawbacks of One-Click Trading is the lack of risk management. For example, to add a stop-loss order, you must organise this through the trading terminal (Ctrl+T).
Below, you will find examples of long and short trades in stock CFDs:
Intel's lower-than-expected second-quarter earnings were released on 1 August, triggering a meaningful decline in the company’s share price, which shed nearly -26% in extended trading. The stock is also down nearly -40% month to date and -61% year to date.
This follows the company's announcement that it would lay off more than 15% of its workforce as it looks to cut costs in a meaningful way, ‘with the majority completed by the end of 2024’. Additionally, the company communicated that it would suspend dividends starting in Q4 24, which would concern passive income investors as many rely on these payment streams, which could have added fuel to the sell-off. Revenue also declined -1% (year on year) to US$12.8 billion (analysts’ expectations: US$12.9 billion), and Earnings Per Share (EPS) came in at US$0.02, versus the expected US$0.10.
The company is forecasting Q3 24 revenue of between US$12.5 billion to US$13.5 billion (US$13 billion at the midpoint, which would mark a slight increase from recent revenue).
Pat Gelsinger, Intel CEO, commented: ‘Our Q2 financial performance was disappointing, even as we hit key product and process technology milestones. Second-half trends are more challenging than we previously expected, and we are leveraging our new operating model to take decisive actions that will improve operating and capital efficiencies while accelerating our IDM 2.0 transformation. These actions, combined with the launch of Intel 18A next year to regain process technology leadership, will strengthen our position in the market, improve our profitability and create shareholder value’.
Some investors see this recent sell-off as an opportunity to buy the stock, adding to their portfolio’s position for Dollar Cost Averaging to hold over the long term and reinvest dividends (analysts believe the company will resume dividends in the future). The stock trades at a forward price-to-earnings ratio (P/E) of 11.83, which some claim is a reasonable valuation and worth the investment compared to what you would pay for other technology companies in the industry.
On the charts, notable support is present on the monthly timeframe, which could help add weight to a potential turnaround in the stock.
From Intel's monthly timeframe, August has clearly been a terrible month for the stock thus far. However, support is present nearby between US$13.10 and US$16.84 (formed through what are referred to as ‘Quasimodo support levels’). This area marks a major base for the stock, and should price engulf the area, this could be potentially problematic and see the stock venture below US$10 and lower.
Meanwhile, on the daily timeframe, price is on the verge of crossing paths with support at US$18.40, closely shadowed by another layer of support between US$16.25 and US$16.80. Resistance is seen overhead at US$20.91, US$22.62, and US$25.32.
As a result of the above analysis, sellers have room to continue ‘stretching their legs’, targeting daily support from US$18.40 and then the daily support area at US$16.25-US$16.80, which happens to reside within the upper limits of the monthly support area between US$13.10 and US$16.84. Before pushing to the downside, a sell-on-rally scenario from daily resistance could also come from US$20.91 or US$22.62. Should the price reach as far north as the daily resistance at US$25.32, an early trend reversal may be underway, and a short position could be challenging.
Dealing in physical shares involves becoming a partial owner in a publicly listed company that is traded on a stock exchange; ownership of the company is proportionate to the number of shares owned. For example, if there are 10,000 company shares outstanding, and you own 1,000 shares, you own 10% of the company. A company issues shares to investors to raise funds for research, development, growth, etc.
Purchasing physical shares entails usually buying common or preferred shares through an investment broker, which is generally the ‘nominee shareholder’ and the investor the ‘beneficiary shareholder’. Most stock investors own shares using this method. The beneficiary shareholder draws dividends and can exercise voting rights.
For speculation and hedging, futures and options markets represent leveraged derivatives, legally binding agreements that are exchanged-traded and standardised (detailing specifics such as quantity and quality of the underlying asset, minimum price fluctuation – tick size – contract expiration date and delivery particulars). Futures and options contracts ‘derive’ their performance from the underlying assets; good derivative underlying assets are generally fungible and liquid.
Purchasing a futures or options contract largely comes down to commitment and right. With a futures contract, both buyer and seller in the agreement commit to buy and sell the underlying asset (in this case, company shares of Intel) at a specified price on a future date. In contrast, an options contract provides the contract holder (this could be either the buyer or seller) the right but not the obligation to buy or sell the underlying asset at contract expiration.
While physical delivery is an option in the futures and options market, most trades are settled in cash before the contract expires.
ETFs are essentially baskets of goods in which shares of that basket are bought (and sold) by investors. These shares of ETFs are freely traded on a stock exchange, just like a regular common stock.
Typically, ETFs are passively managed investments. This means they generally track or mimic a specific index, like the S&P 500 in the US, the FTSE 100 in the UK, or the DAX 40 in Germany. In this respect, ETFs possess a similar structure to Index Funds or Mutual Funds. Therefore, investing in ETFs can help with diversification, making them often low-cost investments.
Stock ETFs vary in type. Some focus on sectors, some on dividend stocks and some on market value. While investing in a stock ETF may include Intel, it is important to understand that the performance of this stock and the ETF will never be identical.
1. Does Intel pay a dividend?
Yes, Intel pays dividends; however, as the article alluded to, the company will suspend dividends starting in Q4 24.
2. What are the major differences between CFDs and physical shares?
CFDs are derivative instruments (always cash settled), while physical shares represent part ownership in a company. CFDs also provide access to greater leverage options than physical share dealing (although leverage is available with physical shares, it is much less than CFDs).
3. Can I trade Intel on MT4 or MT5?
With FP Markets, you can trade Intel via CFD pricing on MT5 and cTrader. Most traders opt for MT5.
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