How to hedge Natural Gas and Crude?

Discussion in 'Trading' started by vincentvega, May 13, 2012.

  1. Are there any suggestions on how to hedge NG or CL to reduce volatility and drawdowns besides just using fewer contracts? If possible, something besides ETFs or options - thanks for the insight.
  2. What are your goals or what are you trying to do , spread, intermarket, intramarket, outrights, directional , seasonal , long term, intraday trading ect???

    Do you trade the futures, the etfs, oil & gas stocks?

    Are you a trucker trying to hedge gas costs, do you have an oil well, a business of some sort that uses NG and CL? We need to know more.
  3. hey man, that's what got me back into trading. I was in a business that was getting killed by high fuel costs, and had a lot of conservative money on the sidelines.

    I checked it out seven days to Sunday and never could find a safe way to play oil.

    I had mini crude against full size CL options

    I checked out all the etf's

    nope, if you can do it you are a better man than me

    the roll kills you if you are just trying to stay long unless it just keeps going up, but in any type of normal market you are the one paying for the opportunity

    no, I know of no way, but if you can come up with one I am more than willing to listen

    and when when you get into NG it is all so much about weather, you might as well be trading wheat or beans which is something you hopefully know something about.

    In otherwords, it aint a market for people like me. Looks easy on the outside, but unless you regularly eat barbeque with the Bush's or shsikabob with the Prince of Saudi I wouldn't be commiting a large portion of your hard earned trading capital.
  4. I'm trading a tiny account (full disclosure, not mine) with a system of mine on energy and other volatile contracts. My worry is blowing out the account with one contract before anything really happens.

    I guess I could use the DX as a hedge, but not sure if that's any less volatile. Maybe the ES?
  5. trading crude oil with a tiny account is idiotic...

    switch to forex and trade mini-lots
  6. No forex is a whole different game. I'm also proficient in commodities.

    Any ideas on how to hedge this? I'll try out the ES, but not sure if other contracts will work better.
  7. Surdo


    Then why are you asking kids here that trade a SIM account or $2500 IB account how to hedge?

    This forum never ceases to amaze me.
  8. I'm a newbie here - should of realized that. Before I noticed a few who got really mad at others - I found this confusing, but completely understandable after reading some of the crap endless "experts" suggest.

    Input from the real traders? :D
  9. Well if you insist on trading with a small account then your best bet is to probably trade NG vs CL , lower margin requirements.

    Welcome to the market, friend

  10. Broker that the sir is using has the same margin for both NG and CL, although I may have that wrong. I was thinking toward NG. Maybe just short NG everyday until Sept 12...why not? :D
    #10     May 13, 2012