Natural Gas ETFs List: Trade Natural Gas through Exchange Traded Funds: Options, Futures, Derivatives & Commodity Trading

Natural Gas ETFs List: Trade Natural Gas through Exchange Traded Funds

List of Natural Gas ETF or Natural Gas Exchange Traded Funds available for trading on NASDAQ and other exchanges.
We've seen in our earlier articles that Natural Gas can be traded as a commodity through Natural Gas Futures Trading or by investing in Natural Gas specific stock. However, there are other ways to trade natural gas if neither commodity futures trading nor sotck trading suits you. There are natural gas specific funds and ETF's (Exchange Traded Funds) which offer you the benefit of diversification instead of taking the stock specific risks.
In this article, we will talk about the commonly traded Natural Gas Exchange Traded Funds

First, let's see how the Natural Gas ETF's are classified:
Natural Gas ETF's are offered in two varieties:
1) Natural Gas ETF's which are based on futures trading and tend trade in and benefit from various futures contracts on natural gas, and
2) Natural Gas ETF's which are based on stocks or equities i.e. they invest money in a selected basket of stocks of companies operating in natural gas business

The list we provide below is also categorized in 2 sections:

List of Futures based Natural Gas ETFs:

United States Natural Gas Fund (UNG )
A very popular and heavily traded Nat Gas ETF with high level of liquidity.
What it tracks: NYMEX traded nat gas fuures contract percentage terms changes Standard near month futures contract positions are taken and rolled over to next month futures contracts upon expiry.
Fund charges are 0.6% per year.

iPath Dow Jones-UBS Natural Gas ETN ( GAZ )
This ETN attempts to track the performance of the underlying index Dow Jones-UBS Natural Gas Total Return Sub-Index. Historically, this has been a volatile fund, but trades with high liquidity.
Expense ratio is 0.75% per year.

United States 12 Month Natural Gas Fund ( UNL )
If a trader of Natural gas does not want to want to be limited by the near month and far month contracts (like UNG), but is rather looking for a long term spreaded exposure to varioud maturities of Natural Gas futures contracts, then this fund will suit such traders. Near month to next 11 months of Nat gas futures contracts are covered in UNL and hence the name "12 Month Natural Gas Fund"
It has an expense ratio of 0.75% annually and comparatively thin volumes when compared with UNG and GAZ.

iPath Seasonal Natural Gas ETN ( DCNG )
A relatively new ETN tracks the performance of the Barclays Capital Natural Gas Seasonal TR Index. The index is a single contract December month only with rollovers happening in October.
Have expense ratio of 0.75% annually - low volume and a bit illiquid instrument in the nat gas space.

Teucrium Natural Gas Fund ( NAGS )
This fund claims to reduce the effects of contango and backwardation. It takes a four months positions in Natural Gas futures contracts thereby distributing the spreads. All 4 month contracts are given equal weight. The strategy appears good as it takes into consideration the seasonal effects and timings required for heating and cooling.
Low volume, but comparatively very high charges of 1.54% (as stated on the official website)

E-TRACS Natural Gas Futures Contango ETN ( GASZ )
Owned by UBS, this ETN tries to replicate the performance of ISE Natural Gas Futures Spread Index. The Contango strategy is to take short near month natural gas futures and long mid term nat gas futures contracts. This is done via various investments in natural gas sub-indices.
Relatively less volatile, less liquidity, and charges higher expenes of 0.85% yearly.

ProShares Ultra DJ-UBS Natural Gas Fund ( BOIL )
A Leveraged ETF for natural Gas, as it promises double the daily returns of the underlying index Dow Jones-UBS Natural Gas Subindex.
A fund with good liquidity but charges high expense ratio of 0.95% per year. Rightly named as BOIL to indicate double the leverage factor.

ProShares UltraShort DJ-UBS Natural Gas Fund ( KOLD )
Another leveraged ETF for natural gas, but on the reverse side, so rightly named as KOLD. It provides negative twice returns of the Dow Jones-UBS Natural Gas Subindex daily performance.

VelocityShares 3x Long Natural Gas ETNs ( UGAZ )
Dont like double exposure and want more than that? Then here is triple exposure with UGAZ leveraged Natural Gas ETN. Tracks three times the daily performance of undelrying S&P GSCI Natural Gas Index ER.
It also comes at high cost - expense ratio of 1.65% annually.

VelocityShares 3x Inverse Natural Gas ETN ( DGAZ )
Reverse of UGAZ, this one provides negative three times return of the undelrying S&P GSCI Natural Gas Index ER.

List of Equity based Natural Gas ETFs

Equity-Based Natural Gas ETFs List:

First Trust ISE-Revere Natural Gas Index Fund ( FCG )
Offered by First Trust, this is a good fund for investors looking to invest in natural gas company stocks and shares. Underlying indes is ISE-Revere Natural Gas Index Typically has around 30 stocks in its holdings. Major focus is on companies directly into production and exploration of Natural Gas.
Expense ratio is 0.6% annually.

Direxion Daily Natural Gas Related Bull 3x ETF ( GASL )
Leveraged ETF for Natural Gas Equities:
Offers triple the daily returns of the underlying ISE-Revere Natural Gas Index. A high expense ratio of 0.95%

Direxion Daily Natural Gas Related Bear 3x ETF ( GASX )
Reverse of GASL, another leveraged ETF but offers negative thrice returns in opposite direction of underlying index.

Natural gas ETF list provided above is a snap shot of common ETF available.
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