Diesel pricing and the gas price ETF

Thursday, December 11, 2008, 9:25 AM:  For future analyses, I have started to keep track of diesel prices on Lake Michigan Drive and the daily close of the US Gasoline Fund ETF (ticker:  UGA).  For the former, I have been asked questions several times over the past year about diesel prices, and my responses have usually been "I don’t have a clue".  I am starting to work on getting a clue, and what I have seen so far after two weeks of observation is that diesel prices don’t change from day to day like gas prices do.

About the ETF, from Yahoo:  "The investment seeks to track, net of expenses, the changes in percentage terms of the [wholesale] price of gasoline."  In two weeks, wholesale prices have gone from $1.13 to $1.00, and the ETF has gone from $22 to $19.  So, if I think we are going to see $2 retail, I could buy UGA or UGA calls to put my money where my mouth is.  If $1 retail is in the cards, then sell short UGA or buy UGA puts.  Disclaimer:  option and stock trading carries risks, you can lose all your investment, etc…

 

Leave a Reply

Your email address will not be published. Required fields are marked *

Please leave these two fields as-is:

Protected by Invisible Defender. Showed 403 to 1,755,031 bad guys.

 

This site uses Akismet to reduce spam. Learn how your comment data is processed.

TheGasGame.com (c) All Rights Reserved Frontier Theme