Red has already sold the majority of it's production @ ~$AUS2,600 for approx 2.5 years. They did this to secure debt financing to build the mine.
Now when the gold price goes up. RED does not sell its gold at spot, it delivers those previous hedges and receives AUD $2,600, missing out on ~$1,000/oz until the hedges are delivered.
If costs go up... RED is constrained by it's hedge delivery requirement, which makes the asset risky.
RED Price at posting:
42.8¢ Sentiment: Sell Disclosure: Held
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