UNG, or the United States Natural Gas Fund, provides exposure to natural gas. This exchange-traded fund (ETF) is a tricky choice. If you are looking to take a risk on natural gas by going short, or trading leveraged ETFs, you may want to consider UGAZ. The reason for this is simple: UNG shares can go up and down in value, and are not directly tied to the price of natural gases.
Inverse Natural Gas, or DGAZ
Attempts to profit from UNG fund losses by leveraging them by three to 200%. This should give you 3% profit for a 1% drop in UNG. As the name implies, DGAZ is leveraged, so if natural gas prices fall, DGAZ should go up. During a bearish market in UNG, traders may want to consider putting their money into DGAZ.
Unlike DGAZ, UGAZ isn’t directly linked to UNG
It tries to mimic the price of natural gas, but it can’t always do that. While DGAZ will not be able to mimic natural gas, it can be a very good hedge against falling prices in UNG. If UNG falls by 1%, DGAZ will give you 3% profit. However, if the UNG fund drops by 5%, the DGAZ should make you 6% profit.
Besides DGAZ, UGAZ can also be a good
Way to profit from natural gas price movements. The DGAZ, or 3x Inverse Natural Gas Fund, seeks to profit from a decrease in UNG by amplifying the losses by three or 200%. If UNG falls by 1%, DGAZ should return 3%. Therefore, if UNG drops by 1%, DGAZ should return the same amount. If you’re bullish on UNG, consider trading UGAZ when the UNG price increases.
The DGAZ fund is a inverse ETF that aims to generate profits by leveraging natural gas prices. It tries to mimic the UNG price, but does not always succeed at it. Moreover, DGAZ is a leveraged ETF when UNG is in a bearish mood. Its 3:1 leverage makes it a particularly attractive option if you are looking to take advantage of this type of hedge.
UNG is closely tied to the UNG
So it’s a good way to profit from price changes in a natural gas fund. This ETF mimics the natural gas price, but it is not as volatile as the natural gas. Instead, it mimics the price of UNG by multiplying it by three or twenty times. When UNG is down by 1%, DGAZ will return 3%. This makes DGAZ an attractive option when the UNG is in a bear market.
Unlike UNG, DGAZ does not track natural gas prices directly
It tracks the UNG, and when one of them drops, the other will follow suit. This means that if UNG goes down, DGAZ will increase. This is a great way to profit when natural gas prices are on the rise. The price of DGAZ has historically been highly correlated to UNG. With a 3:1 leverage, it should be an excellent option during a bearish market.
DGAZ is a 3x leveraged ETF that mimics the natural gas market. The UNG price follows the UNG price, so a 1% drop in UNG should give DGAZ a 3% profit. This type of fund is considered a leveraged ETF when the UNG stock is undervalued. Its 3:1 leverage allows it to outperform the UNG. It can be a smart choice if you are bullish on UNG, but bearish sentiment can affect a PG&E fund, causing a loss.
In contrast, DGAZ reflects the UNG stock
Its price follows the UNG price. If UNG is down, DGAZ is up. Likewise, a 3% loss on UNG should bring a 3% profit. When natural gas prices are going up, DGAZ is expected to show a gain of about 20% a day. It is a better trade if you want to make a profit while the UNG is down.
UNG and DGAZ are the two main ETFs tracking natural gas
When the UNG is up, DGAZ will follow it. If UNG is down, DGAZ will follow suit. Similarly, UNG and DGAZ are mirrored. They are both aiming for a 2%-3% target. The weather forecast is an essential factor in trading natural gas, and a poor one can hurt both a trader and an investor.