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Tuesday, 10 May 16
VOLATILITY? VARIATION NO ENIGMA TO SHIPPING..... - CLARKSONS
 Along with cyclicality, the other characteristic of the shipping markets which receives frequent mention is volatility. This is so evident that the shipping markets are often reported to be many times more volatile than the stock markets or other fluctuating economic variables. Here we take a look at some metrics which shine some light on the relative volatility of the industry.
Measuring The Waves
Many metrics can be used to measure aspects of volatility (though none are perfect). A few are calculated here to compare volatility in the shipping markets with that in the stock and commodity markets. One classic measure of volatility is the ‘coefficient of variation’ which takes the standard deviation of a series over time (a measure of the degree of dispersion of observations in a series) and divides it by the mean (average) level of the series.
Volatile Business
This metric highlights the degree of volatility present in the shipping markets (see graph). For the ClarkSea Index it stands at 50%, for VLCC spot earnings 73% and Capesize spot earnings 104%. For the FTSE-100 the figure stands at 29% and for the S&P 500 43%. The stock markets, often thought highly capricious, appear to be quite a bit less volatile than shipping on this basis (and given that stock markets generally track a trend rather than a cycle, one might have expected their coefficients to be biased upwards). The oil price compares more closely to shipping; the figure for Brent crude stands at 73%. Another useful metric is the average absolute monthly change as a percentage of the mean. For the ClarkSea Index this stands at 8%, for VLCC spot earnings at 26% and Capesize spot earnings 18%. For the FTSE-100 and S&P 500 this stands at around 3% and for Brent at around 6%, so again much lower.
Of course this analysis doesn’t capture everything. It excludes week-to-week (or day-to-day) volatility, though one might suppose that this could further emphasise shipping’s volatility (for example, see VLCC spot earnings on page 2). Equally it does not handle (or ‘de-trend’) indicators differently to account for the fact that stock markets typically follow a long-term trend, rather than a cycle like shipping.
Variation On A Theme?
But, even using a regression approach to ascertain variation from simple trend levels, over 60% of the FTSE-100 movement is explained by the trend. In shipping, much more of the variation appears to remain ‘unexplained’ (less than 10% of the variation of the ClarkSea Index would be accounted for by a simple trend).
Need Good Sea Legs?
So, volatility in shipping easily holds its own against fluctuations in other economic phenomena. It’s a competitive business, and rapid changes in pricing can be driven by the steepness of the supply curve at the margins, as well as a range of quite unpredictable factors. This helps make shipping interesting for asset players and short-term speculators but tricky for investors looking for certainty of return and analysts looking for a clear picture. Like seafarers themselves, shipping market players can quite rightly point to having the stomach for ups and downs as much as anyone.
Have a nice day.
Source: Clarksons
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Wednesday, 08 June 16
THE DRY BULK MARKET KEPT MOVING SIDEWAYS LAST WEEK; SECOND HAND PURCHASES MOVING NORTH - INTERMODAL
Once again its Posidonia time and the biannual exhibition takes place during a very warm June here in Athens, as if the performance of the dry bulk ...
Tuesday, 07 June 16
CS COAL INDEX ROSE FOR SECOND STRAIGHT WEEK
COALspot.com: Average 5000 GAR coal index of Indonesian origin was up 0.38 percent week over week to averaging $39.16 per ton this past week, shows ...
Monday, 06 June 16
BDI GAINED ON A STRONGER DEMAND FOR CAPESIZE SHIPS
COALspot.com: The Baltic Exchange, tracking rates for ships carrying dry bulk commodities rose this past week on a stronger demand for Capesize ves ...
Friday, 03 June 16
DRY BULK VESSEL DELIVERIES COULD BE LESS THAN 50 MILLION DWT IN 2016, AS OWNERS DELAY OR CANCEL NEWBUILDING ORDERS
The dry bulk market has been caught between a rock and a hard place over the course of the past couple of years, as on one hand demand has plunged, ...
Friday, 03 June 16
U.S WEEKLY COAL PRODUCTION SLIDES 1.3% - EIA
COALspot.com – U.S the world’s second largest coal producer has produced approximately totaled an estimated 11.5 million short tons (mm ...
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- Latin American Coal - Colombia
- Bukit Asam (Persero) Tbk - Indonesia
- Kaltim Prima Coal - Indonesia
- Timah Investasi Mineral - Indoneisa
- Maheswari Brothers Coal Limited - India
- Grasim Industreis Ltd - India
- Antam Resourcindo - Indonesia
- New Zealand Coal & Carbon
- Jindal Steel & Power Ltd - India
- SMC Global Power, Philippines
- Kobexindo Tractors - Indoneisa
- Chamber of Mines of South Africa
- Bukit Baiduri Energy - Indonesia
- VISA Power Limited - India
- Uttam Galva Steels Limited - India
- McConnell Dowell - Australia
- GN Power Mariveles Coal Plant, Philippines
- GAC Shipping (India) Pvt Ltd
- Indian Oil Corporation Limited
- Iligan Light & Power Inc, Philippines
- Singapore Mercantile Exchange
- Gujarat Electricity Regulatory Commission - India
- Parliament of New Zealand
- Price Waterhouse Coopers - Russia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- MS Steel International - UAE
- Power Finance Corporation Ltd., India
- Economic Council, Georgia
- ASAPP Information Group - India
- Bhushan Steel Limited - India
- IHS Mccloskey Coal Group - USA
- Kideco Jaya Agung - Indonesia
- Goldman Sachs - Singapore
- Coal and Oil Company - UAE
- Offshore Bulk Terminal Pte Ltd, Singapore
- SMG Consultants - Indonesia
- Sojitz Corporation - Japan
- Gujarat Sidhee Cement - India
- Thai Mozambique Logistica
- Dalmia Cement Bharat India
- Indika Energy - Indonesia
- Therma Luzon, Inc, Philippines
- Medco Energi Mining Internasional
- Trasteel International SA, Italy
- Meralco Power Generation, Philippines
- Formosa Plastics Group - Taiwan
- Bukit Makmur.PT - Indonesia
- Interocean Group of Companies - India
- Karbindo Abesyapradhi - Indoneisa
- Toyota Tsusho Corporation, Japan
- Straits Asia Resources Limited - Singapore
- Central Java Power - Indonesia
- Aboitiz Power Corporation - Philippines
- Sindya Power Generating Company Private Ltd
- Manunggal Multi Energi - Indonesia
- Ambuja Cements Ltd - India
- Globalindo Alam Lestari - Indonesia
- International Coal Ventures Pvt Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- SN Aboitiz Power Inc, Philippines
- Bayan Resources Tbk. - Indonesia
- Indian Energy Exchange, India
- Ceylon Electricity Board - Sri Lanka
- Sakthi Sugars Limited - India
- Mercuria Energy - Indonesia
- Heidelberg Cement - Germany
- Meenaskhi Energy Private Limited - India
- Thiess Contractors Indonesia
- Petron Corporation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Merrill Lynch Commodities Europe
- Kumho Petrochemical, South Korea
- The University of Queensland
- Africa Commodities Group - South Africa
- OPG Power Generation Pvt Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Global Business Power Corporation, Philippines
- Larsen & Toubro Limited - India
- Kartika Selabumi Mining - Indonesia
- Semirara Mining Corp, Philippines
- Bulk Trading Sa - Switzerland
- Georgia Ports Authority, United States
- Tamil Nadu electricity Board
- South Luzon Thermal Energy Corporation
- Eastern Energy - Thailand
- GVK Power & Infra Limited - India
- Cigading International Bulk Terminal - Indonesia
- Intertek Mineral Services - Indonesia
- Commonwealth Bank - Australia
- Mercator Lines Limited - India
- Banpu Public Company Limited - Thailand
- Coalindo Energy - Indonesia
- Electricity Authority, New Zealand
- Romanian Commodities Exchange
- Tata Chemicals Ltd - India
- Ind-Barath Power Infra Limited - India
- Wood Mackenzie - Singapore
- Standard Chartered Bank - UAE
- Ministry of Transport, Egypt
- Sarangani Energy Corporation, Philippines
- Kalimantan Lumbung Energi - Indonesia
- European Bulk Services B.V. - Netherlands
- Eastern Coal Council - USA
- Edison Trading Spa - Italy
- Directorate General of MIneral and Coal - Indonesia
- The State Trading Corporation of India Ltd
- Deloitte Consulting - India
- Star Paper Mills Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- IEA Clean Coal Centre - UK
- Savvy Resources Ltd - HongKong
- Carbofer General Trading SA - India
- Billiton Holdings Pty Ltd - Australia
- PNOC Exploration Corporation - Philippines
- Planning Commission, India
- Central Electricity Authority - India
- Port Waratah Coal Services - Australia
- Orica Mining Services - Indonesia
- India Bulls Power Limited - India
- Videocon Industries ltd - India
- GMR Energy Limited - India
- Bangladesh Power Developement Board
- Vedanta Resources Plc - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Directorate Of Revenue Intelligence - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Oldendorff Carriers - Singapore
- Pipit Mutiara Jaya. PT, Indonesia
- Sree Jayajothi Cements Limited - India
- Sical Logistics Limited - India
- Australian Coal Association
- Simpson Spence & Young - Indonesia
- Aditya Birla Group - India
- Bhatia International Limited - India
- Energy Link Ltd, New Zealand
- Baramulti Group, Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Cement Manufacturers Association - India
- Lanco Infratech Ltd - India
- CNBM International Corporation - China
- Borneo Indobara - Indonesia
- Malabar Cements Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Chettinad Cement Corporation Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Australian Commodity Traders Exchange
- Xindia Steels Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- PowerSource Philippines DevCo
- Binh Thuan Hamico - Vietnam
- Electricity Generating Authority of Thailand
- Bank of Tokyo Mitsubishi UFJ Ltd
- Renaissance Capital - South Africa
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Rio Tinto Coal - Australia
- TeaM Sual Corporation - Philippines
- Salva Resources Pvt Ltd - India
- Indonesian Coal Mining Association
- Jaiprakash Power Ventures ltd
- ICICI Bank Limited - India
- Marubeni Corporation - India
- Neyveli Lignite Corporation Ltd, - India
- Krishnapatnam Port Company Ltd. - India
- Jorong Barutama Greston.PT - Indonesia
- Vizag Seaport Private Limited - India
- Bharathi Cement Corporation - India
- Makarim & Taira - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
- PetroVietnam Power Coal Import and Supply Company
- LBH Netherlands Bv - Netherlands
- Siam City Cement - Thailand
- Semirara Mining and Power Corporation, Philippines
- Coastal Gujarat Power Limited - India
- London Commodity Brokers - England
- White Energy Company Limited
- Kapuas Tunggal Persada - Indonesia
- Bhoruka Overseas - Indonesia
- Altura Mining Limited, Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Leighton Contractors Pty Ltd - Australia
- CIMB Investment Bank - Malaysia
- Essar Steel Hazira Ltd - India
- Agrawal Coal Company - India
- Posco Energy - South Korea
- Kepco SPC Power Corporation, Philippines
- Independent Power Producers Association of India
- Wilmar Investment Holdings
- Ministry of Mines - Canada
- Metalloyd Limited - United Kingdom
- Samtan Co., Ltd - South Korea
- Siam City Cement PLC, Thailand
- Minerals Council of Australia
- Indogreen Group - Indonesia
- Pendopo Energi Batubara - Indonesia
- Energy Development Corp, Philippines
- Barasentosa Lestari - Indonesia
- Mjunction Services Limited - India
- Holcim Trading Pte Ltd - Singapore
- Global Coal Blending Company Limited - Australia
- Ministry of Finance - Indonesia
- Indo Tambangraya Megah - Indonesia
- Global Green Power PLC Corporation, Philippines
- Orica Australia Pty. Ltd.
- Attock Cement Pakistan Limited
- Karaikal Port Pvt Ltd - India
- Madhucon Powers Ltd - India
- Parry Sugars Refinery, India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- The Treasury - Australian Government
- Riau Bara Harum - Indonesia
- San Jose City I Power Corp, Philippines
- PTC India Limited - India
- Alfred C Toepfer International GmbH - Germany
- Mintek Dendrill Indonesia
- Anglo American - United Kingdom
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