• Home
  • About
  • Advertise/Contact
  • Privacy
  • Sitemap

Oil and Gas ETFs

Oil ETF & Natural Gas ETF lists for investing and trading in Energy.

  • Energy ETF
    • Alternative Energy ETF
    • Leveraged ETF
    • MLP ETF
    • What is an ETF
  • How to Invest in Oil
  • Natural Gas ETF
    • Natural Gas Contango ETF
    • Natural Gas ETF 2x
    • Natural Gas ETF 3x
    • Natural Gas Stocks ETF
  • Oil ETF
    • Gasoline ETF
    • Oil ETF 2x
    • Oil ETF 3x
    • Short Oil ETF
  • Oil Services ETF
  • Oil Stock ETF
    • Canadian Oil Sands ETF
    • Double 2x Oil Stock ETF
    • Global Energy ETF

Gasoline ETF Tracks Gas Prices at The Pump

You don’t have to be an investor in oil in order to notice if it’s been going up or down.  Car owners regularly experience the impact of oil price volatility at the pump. Not surprising since gasoline is derived from processing crude oil; gas is used as a fuel to power the internal combustion engine of millions of cars all over the world.

There are a few options for easing the pain of rising gasoline prices such as moving closer to work, buying a smaller car, taking the public transit or even buying an electric vehicle if you can afford one. However, there is also a gasoline ETF for investors looking to speculate on gasoline price movements or seeking to hedge against a rise in the price of gasoline. If you believe unleaded gasoline prices are going up, there is but one ETF to own:

The United States Gasoline Fund (NYSEArca: )
Error opening: http://finance.yahoo.com/d/quotes.csv?s=UGA&f=sl1c1j1ya2
MER: 0.88%
The UGA gasoline ETF is designed to reflect the changes in percentage terms of the prices of gasoline, as measured by the changes of the futures contract on unleaded gasoline traded on the New York Mercantile Exchange, minus the fund’s expenses. UGA’s portfolio mainly holds gasoline future contracts on the physical commodity of gasoline. UGA trades like a stock, you can buy it, sell it or short it as you see fit and it provides you with exposure to the commodity without the need of having a commodity futures account.

Live ONE YEAR Chart of the The United States Gasoline ETF– Symbol UGA 
Given the volatility of gasoline prices, profit opportunities abound. However, you need to keep in mind that this is no buy and hold ETF for the long term. This ETF is suitable for traders looking to capture profits through short term trades. Just like an oil ETF, UGA may suffer of backwardation (futures contracts prices lower than current prices) or contango (futures contracts priced higher than current prices) effects. This means that there’s a risk UGA may not closely track the changes in the price of gasoline over the long run which is a risk shared by all commodity ETFs holding futures contracts.

The price of gasoline is mainly linked to the price of crude oil, a global commodity that is affected by different variables. Since global oil supplies are tight, geo-political events could easily stress oil prices if a major producer faces instability.  The state of the global economy also plays a role in moving oil prices as demand for oil will rise or fall depending on whether the world economy is growing or contracting.  But while oil and gas prices are closely related, prices could drift apart for short period of times based on seasonality. Gas prices are usually lower when the cold sets in as people go on fewer road trips versus rising prices at the pump as gas consumption increases during the summer driving season. Regional supply issues can also impact gas prices across the country based on the type of crude processed by refiners. In the Midwest for example, refiners have access to landlocked crude oil supplies which sell at WTI prices while East Coast refiners have to pay Brent prices for their imported crude. The spread between WTI and Brent oil prices will result in gasoline price divergence across the country until the price gap is closed.

Disclaimer: the information presented above is only for informative purposes. It is in no way an encouragement to buy or sell the aforementioned securities.

Filed Under: Gasoline ETF

Popular Posts

Possible Indicators Guiding Today’s Oil and Gas ETF Investors

Possible Indicators Guiding Today’s Oil and Gas ETF Investors

Short Oil ETF List for Crude Oil and Oil & Gas Stocks

Short Oil ETF List for Crude Oil and Oil & Gas Stocks

Leveraged ETFs: Turbo Charged Trading with a 3x Oil Stock ETF

Leveraged ETFs: Turbo Charged Trading with a 3x Oil Stock ETF

Double Oil ETF – Leveraged ETF List for Oil Trading

Double Oil ETF – Leveraged ETF List for Oil Trading

Oil ETF List and Comparison

Oil ETF List and Comparison

Categories

  • Alternative Energy ETF
  • Canadian Oil Sands ETF
  • Double 2x Oil Stock ETF
  • Energy ETF
  • Gasoline ETF
  • Global Energy ETF
  • How to Invest in Oil
  • Investing
  • Leveraged ETF
  • MLP ETF
  • Natural Gas Contango ETF
  • Natural Gas ETF
  • Natural Gas ETF 2x
  • Natural Gas ETF 3x
  • Natural Gas Stocks ETF
  • Oil ETF
  • Oil ETF 2x
  • Oil ETF 3x
  • Oil Services ETF
  • Oil Stock ETF
  • Products and Solutions
  • Short Oil ETF
  • What is an ETF

Blogroll

© 2014 Oil and Gas ETFs.