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Strategies & Market Trends : The coming US dollar crisis
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To: SG who wrote (22298)8/25/2009 8:29:47 AM
From: Horgad  Read Replies (1) of 71479
 
No...in that sense UNG is safer than a lot of other stocks. If UNG liquidated all of their natural gas futures and distributed the money to their shareholders, you would basically receive what your shares are currently trading at. In other words, there is a direct and firm relationship between the value of your shares and the value of UNG assets which are mainly in the form of natural gas futures.

Picking a major bottom like this one in natural gas is tough business, but it is rewarding if you are right in your long term analysis and have a strong stomach. It is not uncommon to be 50% off on your timing. If you believed that natural gas was cheap at $4.00, you should believe that it is even cheaper now and should be thinking of buying more...

IMHO, The worst case scenario on natural gas (not UNG) is around $2.50 and hanging there for a couple of years (very low odds), before making a run up to at least the current cost of production, 8ish, but probably more and possibly a lot more.

Disclaimer: I have no position in Natural gas yet, but have come close to pulling the trigger a couple of times. The biggest thing holding me back is that it means selling off some other positions that I am bullish on. SJT and HGT and the like look far more attractive to me than UNG for what might turn out to be long term play.
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