UNG.. i just puked out!!

L

limitupmike

well i tooted my horn a lot around here for awhile and guess what.. now it is time to share a big loss.. puked out of UNG trade .. average price 13.14 on 1350 shares.. got out at 8.98.
mistakes...

1. I am an intraday to 2-5 day swing trader and i stayed in this trade for 2 months. I am not a long position trader!!
2. I would not give up on this trade which was dumb
3. i forgot that I can always get out and get back in later
4. I was afraid to screw up a fantastic track record with a 1000 dollar loss which jumped to 5500 hundred at offset!
5. I went on vacation and did not have any trading access what so ever.. but that would not have chagned things
6. I am trading an etf that has a ton of unknown issues
7. I did not take the fundamentals or charts into consideration.

8. if on vacation and you have no partner to watch positions or you cannot dedicate enough time to trades then get out of everythign and get back in later..
\
9. You can always get out and get back in later..


Yes I was warned by a few on here ..i should have listened but i consider it a tough lessoned learned. very painful!
 
You're not alone. I think I'm going to jump out too. Luckily for me, my position is small. I almost didn't leave it small but glad I did.

Hey, Didn't Cramer recomend this a week or 2 ago? Or was it on Fast Momey?

"CNBC, here to releive you of the burden of wealth". :D
 
The irony of course is that you likely capitulated near the bottom. But then again that's what bottoms do, force enough pain until the last of the weak hands have been wrung out.

IMO your biggest mistake wasn't in the idea of going long nat gas, which is actually an excellent contrarian play at this point, particularly if you have a time frame for positions greater than a couple months, and you leg into a position gradually. Your biggest mistake was that UNG isn't a good vehicle with which to play it.

In fact, pretty much any ETF's based upon commodity futures which are prone to contango or backwardation are poor vehicles to play commodities (USO, DXO, UNG, etc.). Better to just go with the futures directly, or companies which produce or deal in such commodities.
 
Maybe the bottom, but looking at spot prices at 2.538 and the next one out at 3.686 is not very comforting. The contango in nat gas right now is very large compared to what crude had when it slid from the 50's to the 30's.


ETA: I sold my position yesterday for a 30% loss. It was in my IRA and I was writing calls on the way down, but still took a nice hit.
 
Quote from zboy2854A:

The irony of course is that you likely capitulated near the bottom. But then again that's what bottoms do, force enough pain until the last of the weak hands have been wrung out.

IMO your biggest mistake wasn't in the idea of going long nat gas, which is actually an excellent contrarian play at this point, particularly if you have a time frame for positions greater than a couple months, and you leg into a position gradually. Your biggest mistake was that UNG isn't a good vehicle with which to play it.

In fact, pretty much any ETF's based upon commodity futures which are prone to contango or backwardation are poor vehicles to play commodities (USO, DXO, UNG, etc.). Better to just go with the futures directly, or companies which produce or deal in such commodities.
More...

If you were to want to be long NG right now and did not want to go futures, what would you choose?
 
Quote from Ivanovich:

If you were to want to be long NG right now and did not want to go futures, what would you choose?
More...

Probably either FCG (a fund of nat gas producers), or perhaps GAS (on the TSE, not the one on the NYSE) or CYMGF, which trades OTC here in the states.
 
I just sold 10,000 shares on the close. its going lower. Fund has to roll in another couple weeks. I think the government is going to step in soon and ban etfs. Once the rumor pour out you'll see a huge panic. Your pretty good getting short, the short etfs.
 
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