| Commodity ETFs (exchange traded funds) have been | | | | exchange traded funds because they are so volatile |
| around for long enough that investors are well aware | | | | and because of the chance that some companies |
| of their presence now, but a newcomer to the market | | | | might back out on their contracts and there is no way |
| is making some waves. Natural gas ETFs have been | | | | to recover from this due to the lack of liquidity of |
| on the market for just over a year and have done | | | | natural gas futures. |
| pretty well so far. In April, 2007, Victoria Bay Asset | | | | Other experts can only see that natural gas EFTs will |
| Management introduced the first natural gas exchange | | | | continue to grow, slowly but surely they say. This is |
| traded fund and in its first year rose over 40%. | | | | because of the crazy weather conditions that seem |
| Victoria Bay manages other energy ETFs and has | | | | to be unending. With extremely cold winters and |
| plans to introduce more in the near future. | | | | excessively hot summers, consumers are using up |
| Natural gas exchange traded funds are futures | | | | natural gas as quickly as it can be pumped in to run |
| commodities that track the price movements of natural | | | | their heaters and air conditioning. These experts are |
| gas and invest in future contracts. Natural gas | | | | the same who suggest buying a one year contract to |
| exchange traded funds can be quite volatile since they | | | | make sure that you hit both seasons. |
| are based on predictions, but volatility is not necessarily | | | | For those of you who are still considering natural gas |
| a bad thing with natural gas ETFs because the trends | | | | ETFs, here are a few things to watch. Weather - |
| tend to go the opposite way of crude oil and can | | | | extreme heat and cold during the seasons, as well as |
| positively offset the oil EFTs in your energy portfolio. | | | | unusual heat and cold in certain regions. Think about it, |
| Natural gas ETFs are not protected by the Investment | | | | if you live in Seattle and are used to mild 75 degree |
| Company Act of 1940 because they are securities. | | | | summers, when the temperature hits 95 you will be |
| Because of this some investors don't feel safe with | | | | cranking up the air, if you have air that is. Many people |
| natural gas, but others seem to enjoy the fact that | | | | in that region don't even have air conditioners because |
| they can trade without these government impositions. | | | | they don't need it, but recently they had a heat wave |
| One downside to natural gas exchange traded funds | | | | and the retailers couldn't keep them in stock. Another |
| is that the fund doesn't pay into federal taxes, nor do | | | | thing to watch is government. Congress is trying to |
| they plan to, and therefore any taxes from earnings or | | | | pass an energy bill to reduce greenhouse gas |
| deductions from losses from natural gas ETFs will be | | | | emissions and countries around the world are trying to |
| the responsibility of the investor. There really is no | | | | figure out what to do about global warming. Natural |
| upside to this except that you get to keep your money | | | | gas burns cleaner than other energies and will soon be |
| and earn interest on it until tax time, rather than the | | | | in even greater demand. Looking for a new |
| management company earning your interest. | | | | commodity ETF? The choice should be simple. |
| Some analysts warn of the high risk of natural gas | | | | |