1-Star ETNs Poised to Plunge: VelocityShares 3x Inverse Natural Gas?

Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, VelocityShares 3x Inverse Natural Gas ETN (NYSE: DGAZ) has received the dreaded one-star ranking.

With that in mind, let's take a closer look at VelocityShares 3x Inverse Natural Gas and see what CAPS investors are saying about the ETN right now.

VelocityShares 3x Inverse Natural Gasfacts


February 2012

Total Net Assets

$16.1 million

Investment Approach

Seeks to replicate, net of expenses, three times the opposite (inverse) of the S&P GSCI Natural Gas Index. The index comprises futures contracts on a single commodity and is calculated according to the methodology of the S&P GSCI Index.

Expense Ratio


1-Week / 1-Month / 3-Month

(32.5%) / (48.7%) / (56.9%)


VelocityShares 3x Long Natural Gas ETN
United States Natural Gas

Sources: S&P Capital IQ and Motley Fool CAPS.

On CAPS, 93% of the 137 members who have rated VelocityShares 3x Inverse Natural Gas believe the ETN will underperform the S&P 500 going forward.

A couple of months ago, one of those Fools, All-Star TerryHogan, succinctly summed up the bear case for our community: "First of all, while [natural gas] hasn't exactly been a stellar investment as of late, it doesn't really have much lower to possibly go. Second of all, 3X leveraged ETFs are crap long-term."

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