In what I think is considered by most to be a continued fall of natural gas prices, UNG has become quite the laggard in the CCIP portfolio. On top of the horrible performance of natural gas prices, UNG itself is creating issues by its inability to offer new shares. This is actually a good thing in the short term because it keeps the price of UNG somewhat boosted above actual natural gas prices. Unfortunately, this also creates the possibility that if UNG is able to offer new shares, the ETF could fall 15% to make up for its current premium to NAV. As such, I have adopted a strategy of simply trying to gain as much option premium in the mean time. I expect to be stuck in this position for at least 6 months. The performance metrics are below:
7/2/2009 -- Sold To Open 1 UNG August $13 Put @ 1.15
8/21/2009 -- Stock Purchase @ $13
8/24/2009 -- Sold To Open 1 UNG October $13 Call @ 0.60
The important purchase metrics are below for insight into possible profit and loss (these all include commissions):
Purchase Price: $1190.00
Possible Max Upside: 15.04%
Annualized Max Upside: 51.32%
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