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VelocityShares 3x Long Natural Gas ETN Message Board

  • jimmyd1313 jimmyd1313 Nov 1, 2013 10:12 AM Flag

    etf price vs nat gas price

    this is definately a very short term trade. on 9/27 nat gas was $3.51 ugaz was $16.16.
    today 11/1 nat gas $3.51 ugaz 13.16??? where did the $3 go ?? into the fund mgrs hands.

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    • On aug 8th, NG touched an August low of 3.13. UGaz touched a low of 11.99. Today Ugaz at 11.99 = NG at 3.42. If NG goes to 3.13 once again UGAZ will be about 8.99 , another 3 bucks. Contango and fees, ouch!

    • Just buy UGAZ for short term trade swings only. And regardless of correlating value to the past vs Nat Gas, simply buy UGAZ on oversold conditions at the moment you think Nat Gas is done going down, then sell on the following upswing, & thus do not care about price decay over the longer term.
      Since the other day, I've been posting UGAZ as a buy in 13's for start of scale-in. Be ready for possible lower, btu later we'll see 17+ for short term reversal trade. Possibly 20+ at some point, so decay or longer term fund value loss is not relevant for such short term strategy.

    • 51501 Nov 1, 2013 3:25 PM Flag

      the " monthly rollover " in contracts is what does it ....Contango or Backwardation must be looked at before buying this, i'm in at 15.30 and #$%$ because i flubbed up and did not check that out BEFORE going long...What we just had was the contract price adjust upwards overnight, so lets say Natgas was trading at 3.58 , contract rolled over to following month and it opened up in the 3.60's range the next day, longs don't benefit from that price increase, becauseit was just due to the contract rollover....So the new price opens up higher, and then traders go and short natgas due to the higher stinks, I went long when UGAZ a week ago when Natgas was around $3.58 and UGAZ was $15.30 ....Now UGAZ is $13.09 and Natgas is $3.52.....This ETF is dangerous if you don't pay attention....Good luck

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