A Giant Bet Against Natural Gas Is Blowing Up

Discussion in 'Wall St. News' started by dealmaker, Sep 11, 2019.

  1. dealmaker


    Hedge funds, money managers went bearish before prices shot up 25%
    unds, money managers went bearish before prices shot up 25%

    Forecasts for muggy weather in September have pushed prices for natural gas higher. Photo: Ralph Wilson/Associated Press
    By Ryan Dezember
    Updated Sept. 10, 2019 5:00 pm ET

    A popular wager in the energy markets is backfiring.

    Hedge funds and other money managers in August built up a big bet that natural gas prices would decline—their most bearish position in the futures market in over a decade—only to have prices shoot up 25%.

    Prices usually weaken when summer subsides since there is less demand to generate electricity for air conditioners. Forecasts for a steamy September have pushed prices higher, though.

    themickey likes this.
  2. RedDuke


    And these people get to manage billions. One's head shake sin disbelief.
  3. trader99


    So, these were the people on the other side on my long NG trades... I don't have that much money as them. Else I would have made a nice bundle.. hehe
  4. What a bollocks. Someone lost and another one made a killing. It's just that the media imbeciles don't get it that positioning just shifts back and forth between hedged and speculators.

  5. KevMo


    Any time the media can whack the dumb and often evil Hedge Fund Mgrs it makes good headlines. I know many traders in the physical energy market having the best years in a decade, and they rarely speak to media outlets.
    GRULSTMRNN and murray t turtle like this.
  6. Here4money


    Going short against the cleanest hydrocarbon in an admin sympathetic to hydrocarbons. Smart move that one.
    murray t turtle likes this.
  7. themickey


    I was hunting for news on this one, but OP's article fills out the reason, I took a bet on this one two days ago, expecting it to be a wild ride, I don't normally track NG prices but will now, just another commodity in a list to add to.
    Hope I don't get burnt.
    GRULSTMRNN likes this.
  8. comagnum


    NG has a strong seasonal tailwind that kicks in in Sept as fall approaches, and the same applies to the Russell 2000 which has clearly gone parabolic.

    Last edited: Sep 11, 2019
    easymon1 likes this.
  9. bone

    bone ET Sponsor

    Jerry Jones has over $1B invested in Comstock shale natural gas fields. Has been increasing his stake earlier in 2019.

    Makes sense. Demand for physical NG is just getting stronger and stronger as more and more coal fired power plants have already made the conversion investment. It's already a huge sunk cost.

    And Mexico is well on their way to converting coal to NG - peaking in 2029.
  10. maxinger


    well. best time to day trade NG is winter time.

    Look at day range. It is extra wide during winter.

    #10     Sep 11, 2019
    ElectricSavant and easymon1 like this.