The market is up at the start today. But I am still betting that there will be some pullback soon. I am going out for a correction in the bullion this time. I decided consciously not to directly bet against the GLD, but go after a big gold company. Newmount Mining (NYSE: NEM) has gone up almost as much as gold has in the last 6 months. Over 1 year though, gold has gone up around 45% and NEM has nearly doubled.
I am playing for a pullback on NEM. Hence, I have bought the NEM November 2009 44 puts at a premium of $135 per contract. Of course, right after I purchased the options, the premium went down to around $120 per contract. So, I am already down around 10%. The option exoires in less than a month, so I am looking for a quick move down for NEM to make some gains on this one. Time will tell.
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