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Strategies & Market Trends : Ride the Tiger with CD -- Ignore unavailable to you. Want to Upgrade?

To: Canuck Dave who wrote (61682)	9/19/2006 3:33:13 PM
From: Claude Cormier	Respond to of 313046

CD Yes..this is what I am trying to do. I've learned that if you hedge at all times, you lose more often and diminish your returns on big plays, like you suggest. So the key is to hedge only in downturns. I try to pick tops. I know it is not always easy, and on occasions you will find a higher top and lose on your hedge. But when it works, you come out ahead. That is why I uses technicals indicator on gold and the big indexes to some degrees. To help me identify when it is time to hedge or not. - It's a jungle out there. More than one way to stalk the wily beast. So true. And I have repeated that many time. To each his own profile and style. As long as you are comfortable with what you are doing.

To: Canuck Dave who wrote (61682)	9/19/2006 4:11:02 PM
From: Julian Augustus	Respond to of 313046

Doesn't hedging like that basically mitigate the upside potential? Not if you just buy puts, which will make money (offset some of the losses on your long positions) if the stock drops below a certain threshold. If you buy 280,000 oz of $600 gold puts, then at $585 gold you are making $15 an oz, or $4.2 mil. The only cost is the premium you paid to purchase the puts, which would be relatively small. Claude's suggestion of buying puts to protect the downside is like buying fire insurance: you hope you never need it, but it is there to help you recoup at least some of your losses if the unwanted happens.

To: Canuck Dave who wrote (61682)	9/19/2006 8:56:44 PM
From: Proud Deplorable	Read Replies (3) \| Respond to of 313046

Speaking of "the big score" Claude...do you still think it's a bad idea to put all your eggs in one basket? (I don't do that anyway) because ARU may prove up 20 million ounces and save everyones portfolio that has it. ARU was up today when most were down. I sincerely believe that this stock is being held down for some reason and wants to break out to 50, on its way to over 100,00, even before Las Arenas is drilled. 20 million ounce deposits aren't unheard of and this looks like one of them. Take KRY for example......it's a 14 million ounce deposit which is worth about $14.00 IMO because of years and years of corruption in VZLA