Re <<Hang tight>>
Besides hanging tight, had this night shorted Puts to wager for / with NEM, GOLD, and WMP, and
... as found the GLD Puts to be too ‘cheap’, so bought GLD Puts (strike 140 & 141) to wager against GLD, covering about all the value exposure of the underlying gold mining shares in my basket, assuming all of the gold shares (NEM, GOLD, WMP, KL, FNV, RGLD) are put to me 21st February. I like sleeping.
The above positions in aggregate, that being OTOH short gold miner Puts / long miner shares, and OTOH long GLD / SLV Puts, are about equal in value, with the hope that i am hedging out the dangers of the underlying metals prices from the mining / exploration (extracting metal in dirt) equation, and the macro optionality of mining reserve in dirt holding function.
IOW, the Puts on the metals are just too cheap - and demands to be bought if one not willing to sell them.
For example, GLD Put February 21 strike 140 (current price of GLD at 145.89, so 4% away) finance.yahoo.com costs 0.34 per share; seems cheap for protection when all expect GLD to rise for any number of good reasons.
If the last $30 of gold price was due to fear of war (i do not fear that) as opposed to terror by ZIRP/NIRP macro, then gold should drop back 30 in a few days / weeks and can collect a gain on the hedge;
Should gold fail to fall back by 4% (November / December levels), not much harm done, as the value on table claimed would be larger than loss on GLD / SLV puts.
Sleep is good if good.
Unclear to me that any of the zig / zag / to / fro actions qualify as investing.
All resemble casino play, or just computer gaming. |
