CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 74-89% of retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Between 54-87% of retail CFD accounts lose money. Based on 69 brokers who display this data. *Availability subject to regulation.
Natural gas is a popular traded commodity, it is the cleanest-burning of the fossil fuels, so with today’s drive to reduce carbon emissions and pollution, demand for natural gas is rising.
Natural gas has to be converted into a liquid – LPG (Liquid Petroleum Gas)- in order to be pumped from one place to another. Major natural gas producers, such as the Russian Federation, send their gas products long distances across Europe, to their key export markets.
The US is a large producer (769 billion cubic metres (bcm)), and shale gas is continuing to expand production but the US still consumes more natural gas (783 bcm) than it produces.
In 2015, the US and Russia (650 bcm) were reasonably close as top producers, followed by Iran, Qatar and Canada. The top consumers were the US, the Russian Federation, China, Iran and Japan.
In 2015, the EU consumed less natural gas than the Middle-East. Japan is shifting significantly from nuclear to natural gas, after the Fukushima reactor accident.
Complex regional insecurities and power politics between the US, North Korea, China and Japan, or unrest that might affect pipelines running through Qatar, Iran and neighbouring countries, could all affect the natural gas price, and weather is always a factor.
Natural gas is bought and sold every day for delivery to energy companies that supply gas to the public. But most traders don’t want to take delivery of actual gas. Brokers such as Plus500, offer natural gas to traders as a CFD, in which you can take a position on a real gas contract depending on whether you think the price of the underlying commodity is going to rise or fall before the contract expires.
Your position is actually on a dated contract, for example “Natural Gas Jun-17”.
In Europe, the ICE Natural Gas Futures contracts are the most actively traded. Henry Hub Natural Gas is the US price benchmark and the futures contract most frequently traded against. Each contract has an underlying 10,000 million British thermal units (mmBtu) of natural gas.
Natural gas CFDs involve taking a position on whether the price will rise and fall and using leverage to increase your profits (or your losses). Because the CFDs reflect underlying futures contracts, you’ll find several of them, with different expiry dates.
CFDs are a much easier way to trade natural gas, because you don’t have to take large minimum positions in comparison to Natural Gas Futures that are designed for large energy corporations.
Some brokers offer a spread bet on natural gas that’s similar to a CFD on an index. There’s no expiry, but you have to pay a charge to hold the position for more than a day.
The spot natural gas market doesn’t use futures contracts but trades on the actual price at the moment. Spot trading is favoured by institutional traders, often working for large energy firms. Spot trades settle immediately, for cash.
You can also buy a futures contract directly from an exchange. You normally have large minimum trade sizes for futures contracts, and of course, the contract expires at a certain point, so you don’t just have to be correct in your view on the price – you have to be correct within a certain period of time.
Natural gas is unusual, in that the spot market can be more volatile than the futures market. This is because delivery difficulties can suddenly affect the spot price. Whereas predictable factors such as the closeness of the winter season may affect the forward (futures) price, all kinds of factors can affect the price for immediate delivery (spot price).
Forex.com scored best in our review of the top brokers for trading natural gas , which takes into account 120+ factors across eight categories. Here are some areas where Forex.com scored highly in:
Forex.com offers one way to tradeForex . If you wanted to trade NATURALGAS
The two most important categories in our rating system are the cost of trading and the broker’s trust score. To calculate a broker’s trust score, we take into account a range of factors, including their regulation history, years in business, liquidity provider etc.
Forex.com have a AAA trust score . This is largely down to them being regulated by Financial Conduct Authority, segregating client funds, being segregating client funds, being established for over 19
|Regulated by||Financial Conduct Authority|
|Uses tier 1 banks|
|Segregates client funds|
Want to see how Forex.com? We’ve compared their spreads, features, and key information below.
|Gold spreads from||0.3|
|Silver spreads from||0.61|
|Copper spreads from||7.0|
|Crude Oil spreads from||5.0|
|Natural gas spreads from||8.0||DAX Spread||250.0|
|FTSE 100 Spread||150.0|
|Platform||MT4, Web Trader, NinjaTrader, Tablet & Mobile apps|
|Base currency options||USD, GBP, EUR|
|Funding options||Bank transfer, Cheque, DebitCard,|