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Politics : Dutch Central Bank Sale Announcement Imminent?
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To: GVC who wrote (8091)10/7/1999 6:54:00 PM
From: Hawkmoon  Read Replies (1) of 81092
 
Interesting take on Barrick..

I do admit that the vagaries of the hedging strategies for gold miners are complex and elude me at times.

Just how do they defer an agreement to sell their gold at a fixed price for such a period of time, maintaining their option to sell at spot?

Why would any counterparty be interested in taking on such an agreement? It would seem they would agree to buy Barricks gold at a pre-set price in order to guarantee a measure of stability in the raw material costs. If that agreement becomes null and void, or deferred, at Barrick's option, I would see little benefit to entering into such an hedging strategy with Barrick.

Where would the buyer of that obligation benefit in having such an agreement?

Regards,

Ron
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