The fund’s presence in the natural gas futures market became the key target of the Commodity Futures Trading Commission’s (CFTC) focus on limiting the size of futures-based ETFs over concerns that such funds were causing volatility in the markets. (Read here for the full rundown). As a result, the providers of such funds have had to find creative ways to stay within these limits while still ensuring that their funds are operating optimally.
Some of the changes, however, may create higher risks that ETF investors need to be aware of – namely, the risk of tracking error.
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- United States Natural Gas (NYSEArca: UNG): down 51.2% year-to-date
Max Chen contributed to this article.