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BetaPro Natural Gas Leveraged Daily Bull ETF T.HNU

Alternate Symbol(s):  HNUZF

HNUs investment objective, is to seek daily investment results, before fees, expenses, distributions, brokerage commissions and other transaction costs, that endeavour to correspond to up to two times 200 Percentage the daily performance of the Horizons Natural Gas Rolling Futures Index the Underlying Index, Bloomberg ticker CMDYNGER. HNU is denominated in Canadian dollars. Any US dollar gains or losses as a result of HNUs investment are hedged back to the Canadian dollar to the best of its ability. The Fund To be successful in meeting its investment objective during the period, HNUs net asset value should have gained up to two times as much on a given day, on a percentage basis, as its Underlying Index rose on that given day. Conversely, HNUs net asset value should have lost up to two times as much on a given day, on a percentage basis, as its Underlying Index declined on that given day.


TSX:HNU - Post by User

Comment by whodathunkiton Mar 16, 2010 2:55pm
203 Views
Post# 16889029

RE: assumptions and why

RE: assumptions and whyResearcher, I think you are missing what I am saying.  If you want to take annual averages you have to account for swings throughout the year, unless the monthly averages are also the same.  As a simple mathematical example shows below, assume the following daily averages:

Jan-Mar   65 BCF
Apr-Jun   60
Jul-Sept   65
Oct-Dec   60

That gives us an average for the year of 62.5 BCF.  But, if you take just Apr to Dec you get an average of 61.7 BCF.  I'm not suggesting that you should use 61.7 for your 294 day calculation but I am saying that you can't use the yearly average for a part of the year because it doesn't equate.  That would mean your year end estimate of 3.055 TCF is likely to be low (and possibly substantially low) and if you use that for where you think the price of gas should be because of that low storage number then I think your gas price estimate will be off as well.

The other question would be, does it make sense that this year's year end storage will be some 28% lower than last years number given the current economic environment?  My guess would be no.

Cheers.
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