Non physical gold - is it an economic armageddon?

摘要

OceanaGold had a particularly ugly hedge book that was debilitating and, for some very unwise management, must have seen dark clouds for the South Island gold producer. It hedged about a third of its production a few years ago through to 2011. The hedge book had fixed forwards at 773 NZ dollars/ounce and it had call options at 1,062 NZ dollars/oz. The difference between OceanaGold's spot price sales and its hedge book was a huge contrast - a highly profitable return from spot and a guaranteed loss for the hedges. The difference between hedge and spot for the company during 2009 was at times greater than 1,000 NZ dollars/oz.