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Natural Gas ETF Short Funds

When people talk about investing in a market, they are generally speaking of buying into a market in hopes that prices will rise. What if you have the opposite opinion? How would you go about investing in a market that goes down and yet you profit from it?
This article will exam how to profit from falling natural gas prices by investing in natural gas ETFs.

One way to short the natural gas market would be to use gas futures traded on the New York Mercantile Exchange. But if you don’t have a futures trading account, or are fearful of trading futures, there is a gas ETF that allows you to buy shares in a short fund.

One such fund is the ProShares Oil & Gas ETF. This fund, ticker symbol is DDG and trades on the New York Stock Exchange. DDG shorts stocks that make up the Dow Jones U.S. Oil & Gas Exploration &Production Index. This index is comprised of companies that are involved in natural gas drilling equipment, pipelines, producers and service companies. Energy companies such as Exxon, Chevron and Halliburton are in this index. This ETF tries to match the single day return of the under lying index.

Would you like to try and leverage your investment to twice the return? If so, you could look at DDG sister fund, the ProShares UltraShort Oil & Gas ETF, tickers symbol DUG. This fund is the same as DDG, but DUG uses leverage to try to get twice the return of ProShares Oil & Gas ETF.

If you want to invest in an ETF that trades natural gas futures, then you should look into the Horizons BetaPro Natural Gas Bear Plus ETF. This fund will short natural gas futures traded on NYMEX. This fund uses leverage and seeks to match twice the daily price move of the futures.

You can learn more about natural gas ETFS by visiting this ETF guide.