The article said:"Asked if he would consider hedging strategies that leave the upside open, such as put options, which preserve the upside potential, Cambre said, ''We obviously look at those strategies from time to time. But given where the price of gold is right now, that doesn't look like an attractive strategy at this point.''"
I sez:"That would suggest to me that they believe that there is still much more risk on the downside, then upside. Unwillingness to take on a put option suggests the pressure is still there. Not a bullish comment."
I never mentioned writing or buying the puts. I never mentioned calls. I never said forwards, swaps, swapotions, futures, future options, spreads, shorts, butterflies, derivatives, spans, spreads, geeks, knock-outs, drawdown. Or any form involving one or more those.
And you sez:"writing put options EQUALS bullish options option."
Well, they refuse to consider the writing of the put options. So they AREN'T BULLISH, at BEST they are neutral. Note, we aren't considering buying puts or writing/buying calls. You just proved that the risk for a further move is down. Why... Because if it was a stable price that they expect, then they would want to capture addition revenue from writing the puts. If the price has stabilized, then Writing a put is the best way to capture additional revenue. And purchaseing a call while writing the put is even more bullish. So they do a disservice to their shareholders by NOT taking on one form or more of risk management. Like it or not, that is the truth.
So the price of gold should still in their opinion decline. Yet they refuse to mention that. And they refuse to take the correct action, which is to write calls. Writing calls, is better then buying puts {nearly always} They have exposed their balance sheets to risk, and as such are not a worthy investment. Consider ABX which makes between 20-40% of their net earnings from hedging. They have taken the exact opposite opinion then NEM. Yet ABX has a lower PE & Higher yield. ABX still out grows NEM.
OTC:
YES, I buy more options then write options. I've never hide that truth, and have stated it many times before. I'm a SPECULATOR, not an investor. I seldom do investing. Time for you to learn the difference. Most options I buy are when the premium is small and the market risks are big. I'm a GAMMA investor, NOT a DELTA investor. Even though I speculated that the POG was going to fall, in my opinion the movement was going to be slow, and drawn out. So In my opinion speculating on a options was a waste of time for the last while. In August the speculations and movement justified buying options {More so then writing} In Early Nov the same. And if you compare the XAU/AU ratio:
goldsheet.simplenet.com
Which is still screaming a buy {their terms}, why is it that the XAU isn't climbing. Maybe they forgot interest rates, and the fact that GOLD can go down in price to make the ratio go up.
Your comments like doughdoughbird & twit only add to the fact that you have little knowledge of the subject that you are attacking me on. Your professed ignorance have shown up many times. YOU JUST DON'T UNDERSTAND! Wait for Y2K to occur, and when the power company cuts you off from not paying your bill. Go live in the bushes, and eat your mule. I really pity you. You missed so much in this bull market, and will miss even more soon. Your like an attention deficit child, any "attention is good atention". So you insult anyone who knows more, explains more, or mentions subject that you think are against your ideology. And still people see you for what you are... ignorant. Even your best allies are turning against you, and ignoring you. |
