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Gold/Mining/Energy : Gold Price Monitor

GDXJ 97.80

+0.9%

Nov 19 4:00 PM EST

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To: goldsheet who wrote (41307)	9/28/1999 1:02:00 PM
From: Lightning	Read Replies (2) of 116764

Could be because ABX, a big piece of XAU, is hedged against three years of production (if memory serves correctly). In other words, Barrick has already locked in the prices they will receive for next 9 million ounces produced. This further implies that they gave up the $450 million profit they could have reaped by closing out their hedge book at the August lows. NEM in similar position as they sold calls to buy puts, i.e. they bought some down-side protection but gave up any increase in gold price above the strike prices of calls sold. Last observation is that some gold bugs may be selling the majors in order to buy the juniors, which have moved strongly yesterday and today but are not represented heavily in the XAU.

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