Tuesday, August 3, 2010

Kinross Buys Redback Mining Creating New Gold Giant: Straddles

Kinross announced it is buying red Back Mining for just over $7B today. The move creates a new major gold company, something that had been expected. However, KGC is being punished and its stock is down over 5%. The combination Kinross Red Back has the potential to be a major force.

Below are straddles for KGC for August and November, computed with the free StraddlesCalc Tool.

Please do your own due diligence. This is not advice. Options are very dangerous and may cause 100% loss.

"The Canadian group is hinting its target's Mauritanian mine contains more of the yellow metal than thought. It thinks it has good reason for its optimism. It bought a 9.4% chunk of Red Back in May and then looked over the mine in question. It isn't allowed to disclose exactly how much gold it thinks is in the ground until it performs a more thorough analysis. But Kinross management says the mine should provide excellent growth for quite some time".

Stumble Upon Toolbar

No comments:

Financial TV

Blog Archive

// adding Google analytics