Natural Gas versus Oil

[suriNotes]

Natural Gas's ABC Pattern with Price and Time Cycle Chart...

Regards,
Suri

 

[Landis82]

Quote from PAPA ROACH:

I'm not saying you can't make any money with UNG, I guess I'm saying it is an inferior tool for a proxy to natural gas. If you want to trade the fixed price of natural gas, open a futures account and trade that, it's what UNG is doing except they are charging you a fee and they have layed out their roll for all the real traders to make money off of like vultures (front running).

And this is what is happening with the USO as well. Due to the contango configuration of the market, each time the Fund sells the front month and rolls into the next month, they wind-up losing another $3.00 on the spread.

Some of these ETF's like the USO are like a freaking Ponzi scheme... AND they even tell specs when they are going to roll too.

Just outrageous!

 

[Landis82]

Papa,

They start "rolling" into the August tomorrow ( June 12th ) for the next 4 days right?

Roll Dates*

June 12, 2009 through June 17, 2009

* "Roll Dates are projected and subject to change without notice. Roll Dates are defined as the dates on which the Benchmark Futures Contract are expected to begin changing from the current closest to expire contract month to the next closest to expire contract month. The change occurs over four days."


Looks like people are already front-running this "roll".

 

[CET]

Quote from Landis82:

And this is what is happening with the USO as well. Due to the contango configuration of the market, each time the Fund sells the front month and rolls into the next month, they wind-up losing another $3.00 on the spread.

Some of these ETF's like the USO are like a freaking Ponzi scheme... AND they even tell specs when they are going to roll too.

Just outrageous!

I was just thinking the same thing about the roll. They need to stop telling when they plan to roll. UNG is supposed to begin rolling tomorrow, but if they did not do it today into this volume they should be shot.

 

[Cutten]

Quote from CET:

I was just thinking the same thing about the roll. They need to stop telling when they plan to roll. UNG is supposed to begin rolling tomorrow, but if they did not do it today into this volume they should be shot.

They should do the opposite of what they say, and try to profit from front-running.

 

[maninjapan]

Probably a pretty simple question, but is there a convential formula for calculating the difference between CL - NG? Is there a way to calculate them on an energy equivelant basis?

 

[rubibond007]

Quote from maninjapan:

Probably a pretty simple question, but is there a convential formula for calculating the difference between CL - NG? Is there a way to calculate them on an energy equivelant basis?

That gap has widened to a ratio of 17 to 1 ($72,23-$4,226= $68,04 a very wide spread) or $4,226 x 17= $71,84.

 

[auspiv]

Quote from maninjapan:

Probably a pretty simple question, but is there a convential formula for calculating the difference between CL - NG? Is there a way to calculate them on an energy equivelant basis?

energy equivalent basis is 6:1

 

[maninjapan]

thanks auspiv, is that 6 natty or crude?

 

[Bailamos]

do you mean Oil-to-gas ratio which is around 17 now?

Although it's higher than historical level but seems natural gas deserves this discount as fundamentals remain so weak.

Watch for the storage report today. Consensus is expecting between a 95-115 bcf injection.