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Buy and Hold This Natural Gas ETF

by Sam Collins 10/14/09

First Trust ISE-Revere Natural Gas Index Fund (FCG) -- This exchange-traded fund (ETF) seeks to replicate, net of expenses, the ISE-Revere Natural Gas Index, which consists of exchange-listed companies that derive a substantial portion of their revenue from the exploration and production of natural gas.

FCG Chart

Chart Legend

Since its low in March, this ETF has more than doubled despite a bear market in the price of natural gas (see today's Daily Market Outlook for more on this).

And, since August, high-volume accumulation has driven the fund higher, tracking its 50-day moving average.

The Moving Average Convergence/Divergence (MACD) issued a recent buy signal, indicating that a breakout from the bull channel is possible with a trading target of $28 to $30.

But long-term investors may want to buy and hold this ETF as an investment in the future of natural gas.

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