Wheels Group Inc GRFJF

Gold Hedge Gains for Q4

[keizaigakusha]

WGI should have a nice boost to earnings in Q4 with the increased value of their gold hedge.  From their last quarterly filing mgmt notes that a 10% fall in gold price from $885 will produce a $35.1 million gain in the mark to market value of their gold hedge.  Given gold is trading around $847 today, we should get a gain of roughly $15 million to earnings from the formula above.

[SkyeCairns]

POSTED by MyStockhouse/Default.aspx?u=2124636"">keizaigakusha Given gold is trading around $847 today, we should get a gain of roughly $15 million to earnings from the formula above You spoke too soon. PoG is hovering around $870 on Boxing Day. So the MTM will be small if it stays where it is. But since we have 3 days to go before year-end who knows where it will end up

[mlmack]

Forget about the gold hedges profit or losses, the higher the price of gold the better. This gold hedge profit or loss is just the price of gold at the end of the quarter, it really doesn't have any effect on the companies cash flow. The higher the price of gold the better even though WGI may show a large hedge loss, as long as they plan to sell into the hedge at $801 it's just an

[babedinkleman]

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[SkyeCairns]

POSTED by MyStockhouse/Default.aspx?u=416628"">babedinkleman I would think that the mark to market would be a loss for anything above $801 as that's where the hedge is. It's only if gold is below $801 that they would show a gain on it. ============================================================================================= I think the original poster was talking about

[babedinkleman]

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