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Strategies & Market Trends : 2026 TeoTwawKi ... 2032 Darkest Interregnum -- Ignore unavailable to you. Want to Upgrade?

To: aknahow who wrote (6355)	5/14/2006 12:14:09 AM
From: TobagoJack	Respond to of 218057

thanks george, i needed that pep talk, truly and now i am ready for the gauntlet :0)

To: aknahow who wrote (6355)	5/14/2006 2:43:30 AM
From: energyplay	Respond to of 218057

>>"Why do I never hear the shorts wimpper or cry?"<< Good question. Ashanti is the only short victim I can think of offhand. Getting into the world of rank speculation... A number of people (well, some paranoids on Kitco) now believe that many of the gold "shorts" were and are actually heavily long physical, and the shorting of futures was one of - 1) A way to get cash for other investments without actually selling the physical and paying the tax and higher transaction costs. So they might sell gold and buy ... dividend paying oil stocks, oil sands, real estate, etc. The gold owners tend to be well connected investors, so they often have interesting opportunities. 2) A tactical, short term trade - still not touching their long term gold holdings. 3) A hedge against their positions in gold mining and other mining stocks, ot their option positions in mining stocks. Sell gold futures and sell put options on say Newmont NEM. Put options are subject to time decay. >Gold rises slightly, the put value disappears quickly, not too much hit on the future side. >Gold stays flat, option declines slowly, gain value of the option minus transaction costs. >Gold drops - use gain from gold future to pay for the NEM stock that is put to you. Or do the same thing, except buy NEM - a dividend paying stock - with some of the proceeds of the future sale.