Smart move or dumb move to remove the hedge? Looking pretty dumb now.
Perhaps a 3rd option. They didn't have a choice?
they closed 41250 ounces and received 6.3m. That gives the gold price margin of $153. The gold price they closed it at was $1762AUD. This means they closed the contracts buy buying the gold at $1609 AUD.
It is 1552$ AUD now.
Should never have closed the hedge. A quick 10m$ CR would have been better.
Ann: Hedging Transaction, page-99
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