UNG To Reopen for New Investments: Is It?

[Note: straddles are computed with our own StraddlesCalc Tool, correlation can be computed with our Correlation Tool, view UNG results here, links to tools on the left side of the blog]

 More UNG gems. UNG managers filed a Form 8-K with the SEC on Friday. Please see below for text. The filing says "...to re-commence offerings of Creation Baskets on September 28, 2009, although such offerings will be limited and subject to the terms and conditions set forth below."

"Currently, UNG’s management believes that UNG will have the ability, under limited circumstances, to offer Creation Baskets as of the above-referenced date and meet its investment objective. If UNG’s management determines prior to the above referenced date that new circumstances have arisen that will prevent UNG from offering Creation Baskets, it will announce through a Form 8-K such changes in circumstances as soon as practicable."

So, maybe it will, maybe it won't. Which one will it be? In any case, UNG dropped 5% on Friday, and another 5% in after hours. It opened at $11.27, and the last after hours trade was at 10.07, for a total drop of about 10%. Please see the after-houts charts:

This is why straddles are so attractive and have been highly profitable with this fund.


FILING:

"PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): September 11, 2009
UNITED STATES NATURAL GAS FUND, LP"


"On August 12, 2009, the United States Natural Gas Fund, LP (“UNG”) registration statement on Form S-3 (333-159772) was declared effective by the Securities and Exchange Commission (the “SEC”). In UNG’s Form 8-K filed on August 12, 2009, UNG’s management announced that UNG would not resume offering Creation Baskets of its units to its Authorized Purchasers at that time and that it would make another filing when UNG planned to re-commence issuance of units through Creation Baskets. (UNG issues and redeems units in blocks of 100,000 units called “Creation Baskets” and “Redemption Baskets,” respectively. Only Authorized Purchasers may purchase or redeem Creation Baskets or Redemption Baskets.) UNG’s management has now determined to re-commence offerings of Creation Baskets on September 28, 2009, although such offerings will be limited and subject to the terms and conditions set forth below."


The complete text of the Filing can be found here.


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UPDATE Monday AM: At 7:10AM UNG is trading at $9.90 in pre-market.