Gasoline going up....how to play it?

S

SideShowBob

I'm convinced gasoline is bottoming and will be heading back up over the next 6-9 months (after the election). Can anyone suggest a good way to play it? I was thinking futures options but whenever I touch options of any kind I end up kissing my money goodbye....any other suggestions? Or is that the best I'm going to get (I don't want to just go long futures -- because hey I could be wrong).

SSB
 
do you mean nat gas or gas that cars use ?

there is an ETF - USO - that tracks crude oil

if gasoline ( that cars use ) rallies hard into the winter

you can be sure crude oil won't be too far behind

:p
 
Quote from SideShowBob:

I'm convinced gasoline is bottoming and will be heading back up over the next 6-9 months (after the election). Can anyone suggest a good way to play it? I was thinking futures options but whenever I touch options of any kind I end up kissing my money goodbye....any other suggestions? Or is that the best I'm going to get (I don't want to just go long futures -- because hey I could be wrong).

SSB
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Energy mutual fund
 
Sorry, meant to say unleaded gasoline, NYMEX contract HU. The problem is I'm pretty sure, but I'm not willing to bet the farm so options seem to be the way to go. Can anyone suggest a good website for modeling futures options -- maybe if I do some price modeling I might not lose money if I'm right about timing and direction :(
 
Quote from SideShowBob:

I'm convinced gasoline is bottoming and will be heading back up over the next 6-9 months (after the election). Can anyone suggest a good way to play it? SSB
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How about buying refiners? Check out VLO, largest independent refiner in the U.S.
 
Quote from SideShowBob:

Sorry, meant to say unleaded gasoline, NYMEX contract HU. The problem is I'm pretty sure, but I'm not willing to bet the farm so options seem to be the way to go. Can anyone suggest a good website for modeling futures options -- maybe if I do some price modeling I might not lose money if I'm right about timing and direction :(
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Sell some OTM distant puts to finance your distant calls on HU.

That'll lower your cost in. Furthermore, it may be wise not to buy too far out of the money.
 
At this point unleaded could go either way, so I'd wait for a catalyst to decide which way... definitely, don't bet the farm.
 
A related question.. what is a 'normal' markup for the price at the pump? The best price in my neighborhood dropped a nickel last week to 2.45, while the nat'l ave was something like 2.25. But the HU has been stuck at 1.45-55 for almost a month. I know prices are sticky downward...:p just wondering what the most 'efficient' price ratio is supposed to be between the two. TIA :confused:
 
Quote from SideShowBob:

Sorry, meant to say unleaded gasoline, NYMEX contract HU. The problem is I'm pretty sure, but I'm not willing to bet the farm so options seem to be the way to go. Can anyone suggest a good website for modeling futures options -- maybe if I do some price modeling I might not lose money if I'm right about timing and direction :(
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oh man...
you should realize that the HU contract is not going to be around for very long...try and find an HU contract out in 2007...they aint there anymore...we are trading the new RBOB contract...
ahhh...ghosts and virgin contracts...try and trade those!!
 
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