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Best Natural Gas Mutual Funds, Natural Gas ETFs, and Natural Gas Stocks for Growth and Income
Read this article to learn how you can maximize return from the best natural gas mutual funds, best natural gas ETFs, and best natural gas stocks.
Natural gas futures traders support this bullishness. NYMEX natural gas futures rise from $3.93 per MMBTU for October 2011 delivery to $4.25 for December 2011 delivery. The price for December 2012 delivery rises 26% to $4.95. The price curve rises through 2014 in a virtual straight-line tagging another 12%. The contract for December 2014 delivery changes hands at $5.56.
Rising natural gas demand and prices translates into opportunity for companies in different segments of the gas value chain. They include natural gas producers, service firms and natural gas distributors. This in turn opens up investment opportunities for mutual fund, ETF, and stock investors looking for growth as well as income.
Best Natural Gas Mutual Funds for Growth
Fidelity offers a wide range of actively managed sector mutual funds under the Fidelity Select funds family. Fidelity Select Natural Gas (FSNGX) is a pure-play no-load natural gas mutual fund. See: How to choose the best Fidelity Select fund
Best Natural Gas Mutual Funds for Income
FBR Gas Utility Index (GASFX) appeals to investors seeking income from investments in natural gas transportation and distribution companies. This natural gas mutual fund invests in utilities, master limited partnerships, and other companies included in the American Gas Association Stock Index.
Best Natural Gas ETFs for Growth
First Trust ISE-Revere Natural Gas Index ETF (FCG) is a pure-play natural gas ETF investing in natural gas exploration, production, and service companies. See: Invest in the Best Sector ETFs Consistently
Best Natural Gas ETFs for Income
JP Morgan Alerian MLP Index ETN (AMJ) and Alerian MLP ETF (AMLP) invest in U. S. energy infrastructure master limited partnerships. While the ETN tends to be more volatile and can offer higher return potential in bull markets, investors seeking tax-deferred distributions usually prefer the ETF structure.
Best Natural Gas Stocks for Growth
Devon Energy (DVN) has successfully transformed itself as a high-growth onshore company and emerged as the largest natural gas producer in the Barnett shale. Devon's dominant position in the Barnett shale is complemented with liquids rich-assets in the Permian Basin. Devon has a well-defined program for increasing production and strong cash flow from current operations should help fund growth prospects. Devon Energy’s EPS is likely to increase 21% in 2012 and another 20% in 2013.
Best Natural Gas Stocks for Income
Targa Resouces (NGLS) is a limited partnership engaged in the business of gathering and selling natural gas and natural gas liquids. This partnership's competitive position is strong by virtue of its access to Henry Hub, the largest U. S. natural gas hub, along with a formidable NGL distribution system in Louisiana and the southeast. Targa's NGL business benefits from the wide price differential between crude oil and natural gas. Targa has increased its dividend distribution by over 10% since 2009 and its stock currently yields nearly 7%.
Beat the Market with Best Natural Gas Mutual Funds and Best Natural Gas ETFs
While growing demand for natural gas can make natural gas investments suitable for long-term investing, you can use such investments as part of a broader sector investing strategy to earn bigger rewards.
Learn 5 Smart Ways of Using Sector ETFs and Sector Funds
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