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NEW YORK (

TheStreet

) -- Natural gas prices rebounded this week, climbing 30% after hitting a seven-year low a week earlier. Exchange traded funds that invest in the commodity also rallied.

The two best-performing funds this week through Thursday, the

iPath Dow Jones-UBS Natural Gas Total Return Subindex ETN

(GAZ) - Get Report

and the

United States Natural Gas Fund

(UNG) - Get Report

, catapulted 25% and 24%, respectively.

There's a killing to be made in natural gas over the next year, but it will be risky. Natural gas futures for January 2010 delivery and later are selling for $5.35 per million British thermal units, double Thursday's spot price of $2.68.

Bullish investors are betting an economic recovery plus continued dollar weakness will make commodities like natural gas a good hedge against inflation.

Qatar is boosting production of liquefied natural gas by 7.8 million tons to 54 million tons a year, with plans to expand to 77 million tons annually by 2011. With storage facilities in U.S. and U.K. filled to capacity, the increase could cause a glut that wouldn't bode well for a sustained rally.

Two ETFs that target solar stocks also shined this week: the

Claymore/MAC Global Solar Energy Index ETF

(TAN) - Get Report

, which rose 17%; and the

Market Vectors Solar Energy ETF

(KWT)

, up 15%.

Shares of

First Solar

(FSLR) - Get Report

, the Claymore fund's largest holding, jumped 17% after the company detailed its plan to build a 2-gigawatt solar farm in Inner Mongolia for the Chinese government. The company won't be alone there.

Canadian Solar

(CSIQ) - Get Report

, whose shares rose 19%, produces 500 megawatts of power in the region, which is part of China's northern border. Local rival

Solarfun Power Holdings

(SOLF)

, which advanced 23%, also plans to generate 600 megawatts from two power projects.

Other strong performers include

Solaria Energia y Medio Ambiente

(SEYMF)

, up 30%;

SMA Solar Technology

, up 23%; and

Energy Conversion Devices

(ENER)

, up 19% on

Applied Materials

(AMAT) - Get Report

takeover rumors.

Inverse funds that bet against energy were the worst performers this week. The

Direxion Daily Energy Bear 3X Shares

(ERY) - Get Report

, plummeted 17% with triple negative leverage, while the

Rydex Inverse 2X S&P Select Sector Energy ETF

(REC)

lost 13% with double leverage.

Crude oil prices haven't crossed $74 since June, despite forecasts of higher demand from the International Energy Agency. Oil prices have been stepping higher each week, putting more pressure on the resistance level. If prices top $75, inverse funds might not fare well.

For more information, check out an

explanation of our ratings

.

-- Reported by Kevin Baker in Jupiter, Fla.

.

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Kevin Baker became the senior financial analyst for TSC Ratings upon the August 2006 acquisition of Weiss Ratings by TheStreet.com, covering mutual funds. He joined the Weiss Group in 1997 as a banking and brokerage analyst. In 1999, he created the Weiss Group's first ratings to gauge the level of risk in U.S. equities. Baker received a B.S. degree in management from Rensselaer Polytechnic Institute and an M.B.A. with a finance specialization from Nova Southeastern University.