If you’re rolling the spot contract, Gilbertie says, turnover rockets up to 1,200%, since you need to roll every month.
The Future of Natural Gas
Although Teucrium doesn’t make pricing forecasts – they only provide products that give investors the ability to act on their own sentiments – Gilbertie’s opinion about the natural gas market is that it’s in oversupply and has been for some time.
“You’ve got horizontal drilling technologies that are so vastly improved in the last few years, you have efficiencies in production and a really good supply,” he says.
Unfortunately, that efficiency has resulted in a flood of natural gas that has pushed the market into a weakened cycle.
“I liken it to the 1990s: so much natural gas came out and prices came down, but then demand skyrocketed.”
Although the launch of the natural gas fund and other ETFs is dictated by a provider’s ability to meet the various regulatory requirements on the way to approval, Gilbertie believes that this is a perfect time to bring such a fund to market.
“Assets tend to flow in when we’re in a down cycle,” he says. On top of that, a down market will give investors time to watch NAGS and see how it works.