Trading Natural Gas

Discussion in 'Commodity Futures' started by unconventional wisdom, Feb 1, 2022.

  1. so much random stuff posted on here lately, how about an actual trade?

    how are you trading natural gas?

    i like long-dated puts on UNG here. thoughts?
    murray t turtle likes this.
  2. RedSun


    Why don't you just trade NG or the micro contracts?
  3. My thought process is simply that natural gas prices are currently high and will likely go down at some point in the future. I don’t want to short outright in case there’s a supply-crunch and price surge. And correct me if I’m wrong, but all things being equal, doesn’t UNG naturally decline in value due to rolling options forward?
  4. RedSun


    UNG is a basket of the front NG contracts. Not sure about the compositions now. If NG contracts stay backward and keep rolling back up, then UNG is bullish.

    But NG and UNG are entirely trading vehicles. They are not good for investing. You really never know where they should stay at. One month hot or cold weather can move price by $1, either way or both ways.
    unconventional wisdom likes this.
  5. maxinger


    Nymex NG is one of the best futures for day trading due to its huge day range.
    margin has increased massively from around $7k to $15k.
    On good days, the day range could be as high as 12%.

    I am sure ICE Europe TTF and NBP NG are also great for day trading.
  6. bone

    bone ET Sponsor

    The rolled futures volume in NG is far greater than the rolled options volume. So much so that ETF's and big Commercials use the Swaps markets more and more.

    RedSun likes this.
  7. RedSun


    UNG may not even hold the physical NYMEX contracts. They can enter total return swaps with prime brokers easily. Like what Billy Hwang did.

    There are also some other financial settled NG contracts.
  8. bone

    bone ET Sponsor

    Yeah, EFP’s especially

  9. %%
    Seldom/\ but kept long tern NG charts so ETFs every now + then.
    I gave away my Billionaire Book by Pickens. Good thing for me i took a hint also how he went bankruot on NG, even though he was in that business all his life.
    And in fairness, could blamegame part of it on his female banker\like the wolverine, T Boone said=she liked to piss on everything she did not eat:D:D
  10. maxinger


    up it goes since 27 Jan 2022.

    either winter is too cold, or the US is selling NG to Europe.
    #10     Feb 2, 2022