#3 United States Natural Gas Fund, LP (NYSEARCA:UNG)
Speaking of contango, that’s been a complaint by many United States Natural Gas Fund, LP (NYSEARCA:UNG) holders before. Due to the fact that UNG rolls its securities forward, long term shareholders suffer in terms of the total amount owned if the front month contract is more expensive than the spot. While backwardation works in investor’s favor, UNG has been a bad performer in the long run and contango and transaction costs have been key reasons. Just pull up the long term chart.
That said, UNG could be a good investment in the short and medium terms if the global economy picks up, the cost of shale gas increases, LNG export terminal activity ramps up, and natural gas fulfills its promise as being a transition fuel.