Horizons NYMEX Natural Gas (HUN-T)

Good if you want natural gas in an ETF. Note: don't buy the leveraged version, HNU.

Commodity-futures ETF, you need an undergraduate course in derivatives management. No ETF can actually hold natural gas, just nat gas futures. Good for traders, but can erode in value over the long term.

Seasonality for natural gas is from September 5 to December 21. This is because, with seasonal investing, you want to be in there before everybody else gets in. The big withdrawals for natural gas is when it is actually used, January and February. In effect, you want to buy the rumour. When everybody else starts to pull in, that’s when you want to get out. Natural gas is down again today. He has a Stop on his position. The warm weather is really exciting things up, and demand has been low.

Natural gas?From a seasonal perspective, natural gas does really well from September 6 into December 21, and we are on the doorstep for December 21. In the last couple of days, natural gas has started to pull back. The end of the year tends to be extremely negative. Refiners in the southern states are taxed on inventory, so they tend to dump it into the market.

(A Top Pick Sept 16/15. Down 18.55%.) It is usually a good sign for securities when you have a consolidation before the seasonal period starts. He stepped into it, and it fell apart. He got stopped out on October 7 when it broke through his support level.

There is a huge amount of oversupply in natural gas. You might want to look at Horizons Natural Gas Yield ETF (HNY-T), which is a Covered Call on natural gas. It has a very interesting yield of about 15% because of the Covered Call premiums they are getting off of natural gas. That is the way he would play natural gas. However, you have to be prepared for a lot of volatility.

There are 2 seasonal periods for natural gas. One is the cooling season in the summertime and the other is the heating season in the wintertime. Natural gas has a tendency to perform well from Sept 5 to Dec 21. Chart shows a nice base, and if it is able to break above that, it will be very positive.