Natural Gas ETF (UNG) worth a punt?

onetrueone

I see UNG is hovering near the all time lows hit a while back and it's in the range 9.10-9.20 at present.
Some posters were recommending UNG as a buy when it the low $9 a few months ago.
Does anybody here think it's still a good bet?
How low do you think it will go?

Bullish

There is a saying "dont try to catch falling knives" you will get hurt,
UNG has a lot of issues, do some research on contango

onetrueone

Yes have done a quick google and it doesn't look good.

http://www.stockpickr.com/view/answers/68905/

Lexus1976

This is a very postive long term buy!!

lucky-colm

Lexus1976 wrote: »

This is a very postive long term buy!!

please explain why you think this??;)

Tech3

lucky-colm wrote: »

please explain why you think this??;)

Sure BOI is the same if not worse

pocketdooz

There is a huge issue with Contango here. Do your research before investing here. Huge risks.

Bullish

I think Lexus thinks it looks "cheap":D
Sorry Lexus, no disrespect but if you pull up a chart on UNG
http://bigcharts.marketwatch.com/interchart/interchart.asp?symb=ung&draw.x=0&draw.y=0

People thought it looked cheap for the past year. It has fell consistantly,
Please do a lot of research before investing in this,

I think we will see a bounce here soon, but that is all it will be IMHO and after is bounce it will resume its downward spiral

Lexus1976

Bullish wrote: »

I think Lexus thinks it looks "cheap":D
Sorry Lexus, no disrespect but if you pull up a chart on UNG
http://bigcharts.marketwatch.com/interchart/interchart.asp?symb=ung&draw.x=0&draw.y=0

People thought it looked cheap for the past year. It has fell consistantly,
Please do a lot of research before investing in this,

I think we will see a bounce here soon, but that is all it will be IMHO and after is bounce it will resume its downward spiral

Bullish do you think that UNG will continue its downward spiral for the foreseeable future. :rolleyes:

I dont think you understand the definition of a Long Term Buy
Please use your common sense!

Bullish

Hi Lexus, It depends on what time frame you call the "Forseeable future" 3 - 6 months then yes I expect it to continue to go down,
I expect a short term rise in the next few weeks... and then drop again by 30 - 40% of its current value before backwardation kicks in( this is speculation on my behalf the 30 - 40% ) , There is the issue that the US government have discussed ETFs like UNG distorting the price of gas, So is UNGs future at risk.

UNG does not track the spot price of NG it trades futures and until NG increases in price above its futures price, UNG will continue to drop.. Here is a nice explanation of the contango..http://www.thedisciplinedinvestor.com/blog/2009/06/15/etf-death-by-contango/
NG is almost at capacity in storage terms, and the drawdown numbers have been bad, What happens if capacity of storage is hit ?
It is trading for a 3.5% premium at the moment.The link below is to the symbol for its NAV value
http://www.google.com/finance?client=ob&q=INDEXNYSE:UNG.IV
I am not a expert in this ETF but I know enough to stay away from it,
there are a lot better opertunities available IMO,
UNG since 10/9/09 is down 14%
GAZ since 10/9/09 is down 10% ( which is also a NG ETF which I would also stay away from)

Natural Gas will be a great play IMO for a long term investment, Just not right now, I will be investing but in companies that will benefit from the rise in price like APL ect ect,(actually APL has massive dept so this one could be risky too)

Lexus, I dont mean to bash your investment but you really need to do your homework on this one,

Best regards

Lexus1976

Lexus, I dont mean to bash your investment but you really need to do your homework on this one.

Hi Bullish,

I'm not considering investing in UNG, just offering my opinion.

ED 209

Natural gas has had a bad year. The ETF is down nearly 50% YTD. Hmmm I wouldn't buy it. But that's just me. I am mr low risk fundamentals. Oil seems to be a better bet than natural gas right now.