Top 10 Summer Stocks
OptionsZone Experts, May 22, 2009
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Top Summer Stock #6: United States Natural Gas Fund
There is going to be a lot of barbecuing this summer, and many of the grills are going to be fueled by natural gas. That alone wouldn't lead us to looking at our next stock, but the prevalence of natural gas as the fuel to cook our steaks, burgers and hot dogs serves as a nice reminder of United States Natural Gas Fund (UNG), which uses futures contracts on natural gas to replicate investment results of the price of the underlying commodity.
In recent weeks, the call option volume on UNG has been through the roof. Since hitting a new 52-week low of $12.69 on April 30, UNG has rallied more than 30%. Natural gas could be in for a nice spike during the summer months, especially considering production is falling like a rock. The number of natural gas rigs is down from a high of more than 1,700 to less than 700, and that means tighter supplies and higher prices in the months to come.
UNG is one of 10 Trades You Don't Want to Miss.
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