September 4, 2008
Unnaturally Bad Gas Pains
Ospraie May Be Latest Victim of Natural Gas Swings
“Amaranth collapsed in 2006 after $6.6 billion of losses on wrong-way bets on natural gas. MotherRock LP, a $400 million fund also folded that year after bets on the commodity soured.
…
‘If you’ve got too much of the stuff [NG] coming out of the ground, there’s no place to put it, and the price just collapses. It’s almost manic depressive: one minute you’ve made a fortune and the next it’s all gone.’”
But if you skim 2 and 20 off the fortune, it’s yours to keep.
UPDATE: Ospraie Says XTO Investment Led to Hedge Fund Losses:
“Ospraie held $128 million of shares of XTO, which was the fund’s biggest U.S. stockholding as of June 30, according to a Securities and Exchange Commission filing. XTO, based in Fort Worth, Texas, slumped 26 percent in July and August as oil and gas prices fell … Ospraie’s flagship fund declined 27 percent last month, extending its loss for the year to 39 percent … Anderson spoke for about 10 minutes and didn’t take questions.”
Questions such as didn’t you see the massive reversal across the charts in early July?
September 4th, 2008 at 10:20 pm
Hi,
Assuming the arrows down indicate shorts taken and arrows up longs taken.
Why did you short it on the way up and not after the reaction?
I am only just curious in how you think, since I have learned to short after a reaction and not before the top.
September 4th, 2008 at 11:48 pm
This is the same guy who took copper to 4$ a few years back cause he sold a raft of it at $3.
Used to work for the Tiger Fund.
Also, not really representing the tarheels very well on the street. Thats ok - we’ve got a few more up there.
September 5th, 2008 at 12:55 am
I hate to speak ill of my fellow traders, but I do hope the price of Natural Gas collapses taking the Long side goons down with it. Not because I’m Short UNG (I’m not), but I’d rather not pay up the butt for heating this winter just because some clown bid the price past “fair value”.
We need to ring the speculative premium out of commodities pronto.
September 5th, 2008 at 9:12 am
@nikke: The red and green arrows mark “countdown perfection,” not spots to go short or long necessarily. The solid green and red trend lines would give you a basic idea whether you’d be looking long or short. Anyone looking long after the turn in early July was nuts.
September 5th, 2008 at 8:58 pm
Those are the TD Sequential counts, yes?
September 5th, 2008 at 9:02 pm
steve: Yes.
September 11th, 2008 at 7:39 am
yea natgas undoubtedly ripped a lot of people’s faces off