Say someone wanted to hedge gasoline prices for this upcoming summer. What would be the best way to do so? My knowledge of trading futures is limited, so bear with me.
I’d like to know this as well. I looked at it 3 years ago and the quantities were huge so it didn’t make sense for someone who only needed to hedge 300 gallons or so.
Get yourself a pickup truck, a big a$$ oil tank, and mosy on down to the nearest Shell station.
Use ETF as a proxy, not the clearest way of doing it, but for your purposes will do the job. Figure out your summer gasoline consumption at today’s price level and buy same dollar value of UGA or even USO, UGA will be a closer hedge for gasoline itself.
What’s one contract, like 42,000 gallons? Why bother? Even if they had a 50 gallon contract, you’re more likely to lose your ass then save any significant money. You’ll use what, 300 gallons? Saving $2 per results in the awesome savings of $600.
ditchdigger2CFA Wrote: ------------------------------------------------------- > Say someone wanted to hedge gasoline prices for > this upcoming summer. What would be the best way > to do so? > > My knowledge of trading futures is limited, so > bear with me. buy a prius.