Henry Hub

AAA

DEFINITION of 'Henry Hub'

A natural gas pipeline located in Erath, Louisiana that serves as the official delivery location for futures contracts on the NYMEX. The Henry Hub is owned by Sabine Pipe Line LLC and has access to many of the major gas markets in the United States. As of June 2007, the hub connects to four intrastate and nine interstate pipelines, including the Transcontinental, Acadian and Sabine pipeline.

INVESTOPEDIA EXPLAINS 'Henry Hub'

The Henry Hub pipeline is the pricing point for natural gas futures on the New York Mercantile Exchange. The NYMEX contract for deliveries at Henry Hub began trading in 1990 and are deliverable 18 months in the future. The settlement prices at the Henry Hub are used as benchmarks for the entire North American natural gas market.

RELATED TERMS
  1. Basis Differential

    The difference between the Henry Hub spot price and the corresponding ...
  2. Liquefied Natural Gas

    The liquefied state of natural gas, which is created by cooling ...
  3. Benchmark

    A standard against which the performance of a security, mutual ...
  4. Futures

    A financial contract obligating the buyer to purchase an asset ...
  5. Delivery

    The action by which an underlying commodity, security, cash value, ...
  6. Futures Contract

    A contractual agreement, generally made on the trading floor ...
Related Articles
  1. Active Trading

    Oil And Gas Industry Primer

    Before jumping into this hot sector, learn how these companies make their money.
  2. Options & Futures

    Fueling Futures In The Energy Market

    The energy market influences every aspect of our lives, and these four options are its driving force.
  3. Options & Futures

    An Introduction To Managed Futures

    Their inverse correlation with stocks and bonds make these alternative investments worth getting to know.
  4. Insurance

    Futures Fundamentals

    For those who are new to futures but want a solid understanding of them, this tutorial explains what futures contracts are, how they work and why investors use them.
  5. Options & Futures

    How does fracking affect natural gas prices?

    Take a deeper look at the impact of hydraulic fracturing on the price for natural gas, and why fracking may eventually price itself out.
  6. Economics

    What country is the world's largest coal producer?

    Producing nearly 50% of the world's supply, China is the world's largest global coal producer and a large force in global coal pricing and trade.
  7. Investing Basics

    The Strange New World Of The Bitcoin Exchange Futures Market

    We explain the basics of the Bitcoin exchange and futures market.
  8. Options & Futures

    A Quick Guide for Futures Quotes

    Here is a quick guide to futures quotes.
  9. Options & Futures

    Is short selling ethical?

    Understand the concept and practice of short selling, and examine the ethical questions that some investors raise in regard to this practice.
  10. Options & Futures

    How is it possible to trade on a stock you don't own, as is done in short selling?

    Understand how the process of short selling allows a person to sell a stock he or she doesn't technically own by borrowing on margin from a broker.

You May Also Like

Hot Definitions
  1. Prospectus

    A formal legal document, which is required by and filed with the Securities and Exchange Commission, that provides details ...
  2. Treasury Bond - T-Bond

    A marketable, fixed-interest U.S. government debt security with a maturity of more than 10 years. Treasury bonds make interest ...
  3. Weight Of Ice, Snow Or Sleet Insurance

    Financial protection against damage caused to property by winter weather specifically, damage caused if a roof caves in because ...
  4. Weather Insurance

    A type of protection against a financial loss that may be incurred because of rain, snow, storms, wind, fog, undesirable ...
  5. Portfolio Turnover

    A measure of how frequently assets within a fund are bought and sold by the managers. Portfolio turnover is calculated by ...
  6. Commercial Paper

    An unsecured, short-term debt instrument issued by a corporation, typically for the financing of accounts receivable, inventories ...
Trading Center