re: Stock plays in Response to Market Mediocrity

I'm not a big fan of ETFs in general so I haven't studied UNG but if you want to play the nat gas segment I would look into KMI (Kinder MOrgan) which is a pipeline and Niko Resources (a canadian based co.)

I honestly think oil (as well as nat gas) has some room to fall so I do not recommend buying them atm. I think oil could go as low as 70-75 within a month and depending if the Fed comes out with a massive print before Optwist is over, then oil will likely shoot back up to upper 90s and the train could pull out before you get a chance to buy. Nat gas is likely headed back down to 2 on Nymex, so it has some room to fall as well.

So, your risk in picking up these nat gas plays is beholden atm to what the Fed may or may not do, US economic impacts, and Europe's woes. Imo, if the fed does do something, it is quite likely they will hint about it sometime this month or in July. The markets have another 5-10% to fall before the Fed really starts shaking in their boots. So look for the dow to be around 11-1l.5k before they really start amplifying their language.

My personal buy targets for KMI would be in the 28-29 range. Anything below that is a good buy as it offers a 3.70% div at its current price of 32.35. KMI at 28 a share would mean a div yield of 4.6% which is very attractive considering the horrendous 10y treasury. Niko looks attractive below 21 a share (its current price is 29.07). I give Niko a lower buy rating b/c of the uncertainty of how investors will respond to stocks with 0 dividend in a tumultuous time as now.

Keep in mind as investors flee euro based assets they will be looking for dividend payers that are limited to the impacts of europe's monstrosities.

That is why you see WMT popping the way it is. It is a defensive play that pays a 4.7% dividend. The big institutionals are looking for safe haven equities and assets.

It's time to build a moat.