Natural gas (NG) futures contracts trade on the CME. Each NG contract calls for the delivery of 10,000 million British thermal units (mmbtu) of natural gas to the Henry Hub, a pipeline junction in Louisiana. Prices on the NG futures contracts are quoted as U.S. dollars and cents per mmbtu. If the price is quoted as 8.30, that means 1 million British thermal units (1 mmbtu) costs $8.30. Typical daily volume for the NG contract is 60,000 contracts. In the summer of 2007, Brian Hunter of Amaranth Advisors, a hedge fund, lost $6.6 billion trading NG futures. Assume that Mr. Hunter took a long position in the October futures contract in July of 2007 at a price of 8.30 and offset that position in September at a price of 4.3. How many contracts did Mr. Hunter have in his long position in order to lose $6.6B when he reversed in September?
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