$6.00
$7.34
bear $6.00
base $7.34
bull $7.34
margin of safety $0.00
market price* $5.60
The United States 12 Month Natural Gas Fund (UNL) is a commodity pool, not an operating business. It holds a rolling strip of twelve monthly NYMEX natural gas futures contracts, plus Treasury securities and cash as collateral, and its units track the price of natural gas futures. It has no revenue, customers, products or growth engine. Its only income is roughly 4-5% interest on collateral, which is smaller than its fees (about 0.60% management fee plus other expenses of about 1%), and its owner earnings cannot be meaningfully projected. Its value therefore comes from the assets it holds, not from a stream of earnings, so we value each unit at its net asset value (NAV). The most recent NAV available to us is $7.34 per unit at December 31, 2025, from the fund's annual report. Its quarterly report for June 30, 2026 was not available for our review, so this figure may be out of date. NAV has fallen from $17.24 at the start of 2023 to $8.58, $8.12 and then $7.34 at the ends of 2023, 2024 and 2025 (returns of -50.2%, -5.4% and -9.6%). Futures-based natural gas funds tend to lose value over time when later-dated contracts cost more than nearer ones and must be rolled at a loss, and that pattern is visible here. Base case: units are worth NAV, $7.34.
Bull case: also $7.34. We cannot name any evidenced driver that would lift the fund's value above its net assets, and a price spike in natural gas is not a driver we can evidence.
Bear case: $6.00. Fees alone, about $0.14 per unit in 2025, plus the recurring roll cost seen in the last three years, point to continued erosion of NAV. This is a modest estimate based on that record. It is not a forecast of the natural gas price. Because the fund has no earning power, there is no basis for a margin-of-safety price at a discount to its NAV. The fund is also small, with average net assets of about $14 million in 2025, down from about $18 million in 2024. Small size raises the risk that it will be liquidated. We therefore set no margin-of-safety price. Our valuation is the net asset value and nothing above it. This valuation would be wrong if natural gas prices rose sharply and stayed high, in which case NAV would rise, or if the fund is liquidated at a value different from the reported NAV.