| An Alternative Look at Last Week’s Natural Gas Performance | |
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Balmy Weather and Bullish Inventories Supporting Natural Gas Prices (Continued from Prior Part) Different approaches to Natural gas
Natural gas futures gained 4.7% last week. But retail investors don’t have easy access to the futures market. Fortunately, there are other safer, low-cost avenues for retail investors to bet on natural gas prices.
The first option is the United States Natural Gas Fund (UNG)—an ETF that tracks prompt natural gas futures. UNG shares trade on the NYSE like a company stock. They gained 5.3% last week.
The second option is an ETF like the SPDR S&P Oil & Gas Exploration & Production ETF (XOP), which holds many US energy companies. Many of these energy companies have exposure to natural gas prices due to their upstream (gas production) operations. So, because of the indirect exposure to volatile natural gas prices, an ETF like XOP is a safer, more diversified option for more conservative investors. XOP lost ~2.4% last week.
As we can see in the graph above, natural gas or NG underperformed UNG last week. XOP underperformed both NG and UNG towards the end of last week. The graph above notes that, like XOP, natural gas prices fell in the earlier part of last week, but unlike XOP, natural gas prices recovered from their fall. This is because XOP also includes companies with exposure to crude oil prices, which fell last week.
XOP holds premier US gas producers like Noble Energy (NBL), Chesapeake Energy (CHK), and Devon Energy (DVN). All these companies make up 4% of the ETF.
Continue to Prior Part Browse this series on Market Realist:
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Noble Energy
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CODE : NBL |
ISIN : US6550441058 |
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ProfileMarket IndicatorsVALUE : Projects & res.Press releasesAnnual reportRISK : Asset profileContact Cpy |
Noble Energy is a producing company based in United states of america. Noble Energy is listed in United States of America. Its market capitalisation is US$ 4.9 billions as of today (€ 4.1 billions). Its stock quote reached its highest recent level on May 09, 2008 at US$ 97.39, and its lowest recent point on August 31, 2020 at US$ 10.00. Noble Energy has 492 191 992 shares outstanding. |