Stockchase Opinions

Richard Croft HBP NYMEX Natural Gas Bear+ etf HND-T COMMENT Oct 23, 2009

Caller Plays HMU/HMD, the up and down alternately so you gain as Gas goes up AND down. Guest doesn’t do it.
$5.170

Stock price when the opinion was issued

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Nat Gas is random about now, typically. Important low in August and goes significantly higher by November. Play it on the bull side in August.
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There is an awful lot of gas out there and these things (HNU/HND) can be quite volatile. He is not anxious to participate in this market now.
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Leveraged double down for Nat Gas. At the upper endof the range you want to avoid gassy players. At the lower end of the range you want to accumulate. These leveraged ETFs are not good for long term holds.

WAIT

Good vehicle for short term trading. He would wait for this. It is bouncing around. Nat Gas is rallying again. Wait for a key reversal day. Maybe on a Thursday after an inventory report.

COMMENT
Inverse and directional ETFs are okay for short term exposure is okay. No issues for holding a matter of weeks. Usually, it turns into a long term hold and then it becomes a problem. Not for long term trading. If you have a short term view that natural gas will go up, it is a good option. However, you are trading commodity futures so you must understand this. The more volatile the underlying asset is, the worse it is as a long term hold.