A Smart Setup on a Gold Miner Amid Oil’s Sudden Slide, Weaker Dollar

The global economy got a big slug of good news on Friday as Iran announced they would allow the Strait of Hormuz to be fully reopened during the current ceasefire. Hopefully this holds, is implemented fully, and is expanded following a peaceful resolution to this regional war. Not surprisingly, oil fell hard on the news and equities rallied strongly.

My regular readers know I have been adding gold mining exposure to my portfolio for a while now, after prices for the yellow metal plunged earlier this year. An end to the hostilities should support this investment thesis. Falling energy prices will help reduce operating costs at gold mining concerns significantly.

If the Iranian conflict is winding down, the dollar should give up a good chunk of its recent strength. The massive amount spent by the U.S. during this conflict and the huge increase in defense spending the Trump administration is seeking for FY 2027 is another negative for an already challenged federal budget that has been running annual deficits in the $2 trillion range in recent years. This also should be a positive for gold prices.

One of the more recent additions to my portfolio is large gold miner Barrick Mining Corp. (B) , and it our latest covered call trade idea.

Barrick operates 11 gold mines and three copper mines across five continents. It was the third largest gold miner on the globe in 2025, extracting some 3.26 million ounces and has over 85 million ounces of proven reserves.

The crown jewel of Barrick’s portfolio is its 61.5% interest in the Nevada Gold Mines joint venture with Newmont Corporation (NEM) , another gold miner I have a stake in right now. Consisting primarily of the open pit and mining operations at Carlin, Cortex, and Turquoise Ridge sites, the three Tier 1 assets collectively represent the largest gold mining complex globally, having yielded 1.59 million ounces at an all-in sustaining cost of $1,620 per ounce and total cash cost of $1,229 per ounce in 2025. This operation accounts for 78% of Barrick’s proven reserves and management believes this geography has significant additional discovery potential as well.

It should be noted that Barrick and Newmont are engaged in recent litigation around this joint venture which has heightened tensions between the two partners. Hopefully, these issues will be resolved in the near future. The joint venture was formed in 2019.

Barrick also produced 220,000 tonnes of copper in 2025, up 13% from the prior year.

The company has a rock-solid balance sheet thanks partly to the divestiture of $2.5 billion in non-core assets in 2025. Barrick produced $3.9 billion in free cash flow last year and repurchased some $1.5 billion in its own stock. To put in perspective, the stock’s current market capitalization of just over $70 billion.

Management recently increased its base quarterly dividend 40% to $0.175 a share with a stated intention to pay out half of its attributable free cash flow back in the form of dividends, regular and special. Its most recent quarterly disbursement of $0.42 a share translates to a somewhat moving target yield of nearly 4%.

The current analyst firm consensus has profits growing around 50% this year to $3.75 a share on a 30% rise in revenues. The shares currently trade at just under 12 times forward earnings estimates.

Option Strategy

Here is how one can establish a position in B using a covered call strategy. As a reminder, covered-call orders involve buying an equity and simultaneously selling just out of the money call strikes against the new position.

Selecting the October $40 call strikes, fashion a covered call order with a net debit in the $35.50 to $35.80 a share range (net stock price - option premium).

This strategy delivers downside protection of 19% across the trade duration, including two projected quarterly dividend payouts of $0.42.

The strategy also provides upside potential of more than 14% even if the stock trades down 8% over the option duration.

At the time of publication, Jensen was long B and NEM.