How to play Nat Gas?

Discussion in 'Trading' started by drukes1234, Mar 3, 2011.

  1. Let's say one were bullish Natural gas for 2011 and would like to be long for a full year. How would one play this? CHK or other stocks aren't interesting to me as they have all spiked already and may not track Natty all that well. I want a pure play but the UNG is obviously quite a joke. Would buying 2012 futures make sense? Or LEAPS in nat gas? Any ideas?

  2. TraDaToR


    Here is the futures curve if you want to compare expiries :

  3. TraDaToR


    You may want to ask Papa Roach or the other seasoned nat gas traders about the best long exposure.
  4. They don't call NG the widowmaker for nothing - trust me.

    There will have to be a substantial move in NG to overcome the steep contango shown in the chart. If you think this will happen either buy longer dated futures or options on futures (not on UNG!). Or you could just short the rallies since NG is in a persistent downtrend due to huge oversupply. If you really want excitement take a directional position at 10:29 every thursday:D
  5. TraDaToR


    I thought the "widowmaker" was Mar/april NG spread, not NG as a whole.
  6. NG isnt the window maker itself.

    H/J spread is known for this name....

  7. So there really is no logical way to play Nat Gas over a year long period
  8. Sure, just dont use lot of leverage, maybe look at shape of curve out back...

    Although it is tough
  9. NG seems to be a good alternative to OIL and gaining momentum, publicity. But timing is the key. A lot of traders will lose a lot of money for going long on NG. :D
  10. The point of this thread isn't to discuss Nat Gas direction, it's to discuss HOW TO PLAY IT, then your guess on the direction can actually be profited on.
    #10     Mar 3, 2011