As readers may have noticed, gasoline prices have had huge volatility recently. Yesterday the gas prices at my local station dropped 5%, a coupe of hours after I filled up of course.
Investors can profit or protect themselves against these price variations by using ETFs. A ETF for gasoline is UGA. It has shown considerable volatility.
The long term trend has clearly been up:
The volatility shows on on intra-day charts:
A very simple strategy to protect against increases in the price of gasoline is by buying UGA. UGA has gone up 16.9% this year.
In general, investors do not need downward protection, as that is simply reflected when they fill up. It's a very simple strategy.
We track all oil ETFs live here.