It was common knowledge that SGW had hedged 10 years or so of production a few years back. It was known a few years back that SGW was having production problems and struggling to meet its hedging commitments. SGW became a banking company rather than a gold company and it took a bet that the gold price wouldnt rise and that it could produce as much gold as it said. Those who bought into this company also took on this bet, they werent buying a gold company but buying a bet on the price of gold.
Your bet didnt come off and you lost....thats the game of the markets
Maybe SGW would have survived if it didnt mine gold but just employed a couple of derivate traders instead, would have made life a lot easier.
SGW Price at posting:
0.0¢ Sentiment: None Disclosure: Not Held
