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Gold/Mining/Energy : Gold Price Monitor

GDXJ 101.44

+3.5%

Nov 12 4:00 PM EST

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To: James F. Hopkins who wrote (9090)	4/1/1998 10:10:00 PM
From: Greg Ford	Read Replies (2) of 116757

Scotia McLeod in Canada puts out a hedging survey quarterly that details forward and option positions of North American producers. I can't remember if it deals with Australian and South African producers. The report is interesting reading. Barrick for example has over 10 million ounces hedged. That means that the upside if gold moves to the hedge price level is already factored in to Barrick's price. I don't follow your logic regarding puts. The puts will only be exercised if the price is below the put strike. Most of the dealers that have granted the puts have already hedged their exposure. It is unlikely that anybody who granted the puts will try to push the price higher so that the puts will not be exercised. The cost strictly in cash outlay terms would likely be far greater than closing out the puts. Greg

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