Commodities Markets Biography
While this may seem somewhat high, investors should note that the product doesn’t just roll into a new contract every month and instead uses a more dynamic process in order to hopefully mitigate contango. This includes holding the second-to-expire, third-to-expire, and the next December contract that expires (following the third-to-expire contract).
This approach, and more importantly, the sweltering heat across much of the Midwest, has helped the fund perform quite well in recent weeks. In fact, the product is now up 22% in the past month, although it is more or less flat from a year-to-date look.
Natural Gas
Although the U.S. is just the second biggest producer of natural gas—trailing Russia by just a bit—the product is generally a local commodity that doesn’t really stretch across international borders. This is generally due to the lack of cross-ocean pipelines and the relative difficulty that comes from transporting a gas quickly and efficiently across vast distances.
Due to this, pretty much all the natural gas that is produced in the U.S. stays in America, making the products that are focused on U.S. natural gas futures a great way to "buy American." Furthermore, even if new technologies open up the market to transportation or exports, America could benefit from lower oil imports or higher exports to natural gas starved markets in the Asia-Pacific region or even Europe (read Have the Natural Gas ETFs Finally Bottomed Out?).
While this may seem somewhat high, investors should note that the product doesn’t just roll into a new contract every month and instead uses a more dynamic process in order to hopefully mitigate contango. This includes holding the second-to-expire, third-to-expire, and the next December contract that expires (following the third-to-expire contract).
This approach, and more importantly, the sweltering heat across much of the Midwest, has helped the fund perform quite well in recent weeks. In fact, the product is now up 22% in the past month, although it is more or less flat from a year-to-date look.
Natural Gas
Although the U.S. is just the second biggest producer of natural gas—trailing Russia by just a bit—the product is generally a local commodity that doesn’t really stretch across international borders. This is generally due to the lack of cross-ocean pipelines and the relative difficulty that comes from transporting a gas quickly and efficiently across vast distances.
Due to this, pretty much all the natural gas that is produced in the U.S. stays in America, making the products that are focused on U.S. natural gas futures a great way to "buy American." Furthermore, even if new technologies open up the market to transportation or exports, America could benefit from lower oil imports or higher exports to natural gas starved markets in the Asia-Pacific region or even Europe (read Have the Natural Gas ETFs Finally Bottomed Out?).
Commodities Markets
Commodities Markets
Commodities Markets
Commodities Markets
Commodities Markets
Commodities Markets
Commodities Markets
Commodities Markets
Commodities Markets
Commodities Markets
Commodities Markets
Commodities Markets
Commodities Markets
Commodities Markets
Commodities Markets
Commodities Markets
Commodities Markets
Commodities Markets
Commodities Markets
Commodities Markets
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