RIVERRED Sorry I dont think I answered your question. Im assuming MCQ would have bought call options ie 20,250 for a premium of 5mil which roughly works out to 246.0 per oz, this means the POG has to be 1646p/o to break even. BDR would have written the option to supply MCQ 20250oz of gold at the strike price of 1400per/oz, which means if MCQ exercises those options when say gold is at 1700p/oz this means that BDR is obliged to sell to MCQ 20250oz of gold at 1400p/o no matter what the POG is at the time the options are excercised when they were only paid 5mil. The 5mil is the premium BDR got for the options contract. This may seem small but BDR has got 5mil to work with immediatley.
Im not sure about the limited part of this option and what that means and Im not sure about buying gold bullion as an option rather than shares But I think thats about it.
Swimming in circles here
BDR Price at posting:
99.0¢ Sentiment: Buy Disclosure: Held
