| Natural gas is often defined by its utilities. It generates electricity, heats homes, and fuels vehicles. Most investors are aware how natural gas is used. But not everyone understands how natural gas is traded. Today we're going to break down what natural gas futures are and how they work in the commodities market. Knowing how it's traded every day lets you understand how it's priced and how to interpret movements in natural gas futures.
A natural gas future - like all commodities - is a contract obligating the buyer to purchase a specific quantity of natural gas at a future date and price. Delivery dates are set around the 15th day of the following month. Futures are priced per million British thermal units (BTUs) - one BTU is the amount of energy needed to change one pound of water by one degree Fahrenheit...............................................Full Article: Source
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