IronCity

Divergence Between Natural Gas and Oil Prices at Extremes

A friend sent me an idea for a covered call: buy UNG and sell Januaty 2010 call, strke 16 at 2.60.
Lowest UNG's price since this ETF begins: 12.69 (April 30, 2009).

Last closing price: 14.58
You get UNG at a net of 11.98 if in January price is under 16 (it is lower than the present historical price).

If your shres are called you will have a profit of $ 4.02 or a 33.5% over your investment (no commissions included).

I would greatly appreciate hearing opinions on this speculation.