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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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Monday, 02 May 16
INDIA'S GANGAVARAM PORT SETS ALL INDIA RECORD FOR NON-COKING COAL DISCHARGE
COALspot.com: Gangavaram Port, the deepest and the most modern port in India, has created yet another historical milestone record by discharging 15 ...
Monday, 02 May 16
CS (I) 5000 GAR COAL INDEX CLOSES 0.11% HIGHER, 5700 GAR COAL RISES 0.07% W/W
COALspot.com: Average 5000 GAR coal index of Indonesian origin up 0.28 percent week over week to averaging $38.78 per ton on this past Friday, acco ...
Monday, 02 May 16
FREIGHT RATES ARE EXPECTED TO BE FLAT TO SOFT THIS WEEK
COALspot.com: The Baltic Exchange, tracking rates for ships carrying dry bulk commodities continued to rose this week.
The freight market was ...
Saturday, 30 April 16
40 YEARS OF HANDLING COAL AT THE BTW IN WILHELMSHAVEN UNDER THE RHENUS FLAG
Press Release: The first bulk carrier with coal on board docked at the Bulk Terminal Wilhelmshaven (BTW), which is operated by Rhenus Midgar ...
Friday, 29 April 16
U.S. COAL IMPORTS IN Q4' 15 DECLINED TO 2.7 MMST FROM 3 MMST IN Q3' 15
COALspot.com – U.S the world’s second largest coal producer has produced approximately totaled an estimated 10.3 million short tons (mm ...
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- Asia Pacific Energy Resources Ventures Inc, Philippines
- SMG Consultants - Indonesia
- Semirara Mining Corp, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Kaltim Prima Coal - Indonesia
- Savvy Resources Ltd - HongKong
- Central Java Power - Indonesia
- The Treasury - Australian Government
- Gujarat Sidhee Cement - India
- New Zealand Coal & Carbon
- Romanian Commodities Exchange
- Cigading International Bulk Terminal - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- London Commodity Brokers - England
- Planning Commission, India
- Posco Energy - South Korea
- Leighton Contractors Pty Ltd - Australia
- Riau Bara Harum - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Uttam Galva Steels Limited - India
- Sojitz Corporation - Japan
- Trasteel International SA, Italy
- Indian Energy Exchange, India
- Star Paper Mills Limited - India
- GAC Shipping (India) Pvt Ltd
- Straits Asia Resources Limited - Singapore
- Coastal Gujarat Power Limited - India
- Price Waterhouse Coopers - Russia
- Sinarmas Energy and Mining - Indonesia
- Essar Steel Hazira Ltd - India
- Lanco Infratech Ltd - India
- OPG Power Generation Pvt Ltd - India
- Sical Logistics Limited - India
- Miang Besar Coal Terminal - Indonesia
- Antam Resourcindo - Indonesia
- GMR Energy Limited - India
- Wilmar Investment Holdings
- San Jose City I Power Corp, Philippines
- Energy Development Corp, Philippines
- Formosa Plastics Group - Taiwan
- Attock Cement Pakistan Limited
- Port Waratah Coal Services - Australia
- Alfred C Toepfer International GmbH - Germany
- Mjunction Services Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- CNBM International Corporation - China
- Barasentosa Lestari - Indonesia
- IHS Mccloskey Coal Group - USA
- Indonesian Coal Mining Association
- Tata Chemicals Ltd - India
- Ministry of Mines - Canada
- Banpu Public Company Limited - Thailand
- Bhoruka Overseas - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Global Coal Blending Company Limited - Australia
- Samtan Co., Ltd - South Korea
- Indian Oil Corporation Limited
- Simpson Spence & Young - Indonesia
- Oldendorff Carriers - Singapore
- Pipit Mutiara Jaya. PT, Indonesia
- Bukit Makmur.PT - Indonesia
- The State Trading Corporation of India Ltd
- Bhushan Steel Limited - India
- TeaM Sual Corporation - Philippines
- Marubeni Corporation - India
- Australian Commodity Traders Exchange
- Gujarat Mineral Development Corp Ltd - India
- Sakthi Sugars Limited - India
- Kideco Jaya Agung - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Petron Corporation, Philippines
- Kumho Petrochemical, South Korea
- Central Electricity Authority - India
- Altura Mining Limited, Indonesia
- Maheswari Brothers Coal Limited - India
- Dalmia Cement Bharat India
- Larsen & Toubro Limited - India
- Bhatia International Limited - India
- Meralco Power Generation, Philippines
- GVK Power & Infra Limited - India
- Global Business Power Corporation, Philippines
- Jindal Steel & Power Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Vizag Seaport Private Limited - India
- Gujarat Electricity Regulatory Commission - India
- Iligan Light & Power Inc, Philippines
- Aboitiz Power Corporation - Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Independent Power Producers Association of India
- Singapore Mercantile Exchange
- LBH Netherlands Bv - Netherlands
- Heidelberg Cement - Germany
- Rashtriya Ispat Nigam Limited - India
- Directorate Of Revenue Intelligence - India
- Directorate General of MIneral and Coal - Indonesia
- SMC Global Power, Philippines
- Bulk Trading Sa - Switzerland
- Standard Chartered Bank - UAE
- Kepco SPC Power Corporation, Philippines
- Bayan Resources Tbk. - Indonesia
- Latin American Coal - Colombia
- Jaiprakash Power Ventures ltd
- Tamil Nadu electricity Board
- Rio Tinto Coal - Australia
- Economic Council, Georgia
- Sarangani Energy Corporation, Philippines
- Agrawal Coal Company - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Chettinad Cement Corporation Ltd - India
- Carbofer General Trading SA - India
- Coalindo Energy - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Jorong Barutama Greston.PT - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Siam City Cement - Thailand
- IEA Clean Coal Centre - UK
- Ministry of Finance - Indonesia
- Siam City Cement PLC, Thailand
- SN Aboitiz Power Inc, Philippines
- Bangladesh Power Developement Board
- Ambuja Cements Ltd - India
- Makarim & Taira - Indonesia
- VISA Power Limited - India
- Indika Energy - Indonesia
- Meenaskhi Energy Private Limited - India
- ASAPP Information Group - India
- Globalindo Alam Lestari - Indonesia
- Medco Energi Mining Internasional
- Thiess Contractors Indonesia
- Edison Trading Spa - Italy
- Georgia Ports Authority, United States
- McConnell Dowell - Australia
- Commonwealth Bank - Australia
- The University of Queensland
- ICICI Bank Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Aditya Birla Group - India
- Electricity Authority, New Zealand
- Merrill Lynch Commodities Europe
- Australian Coal Association
- Karbindo Abesyapradhi - Indoneisa
- Therma Luzon, Inc, Philippines
- Borneo Indobara - Indonesia
- Mercuria Energy - Indonesia
- Malabar Cements Ltd - India
- Ministry of Transport, Egypt
- Chamber of Mines of South Africa
- PNOC Exploration Corporation - Philippines
- Energy Link Ltd, New Zealand
- Vijayanagar Sugar Pvt Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Africa Commodities Group - South Africa
- AsiaOL BioFuels Corp., Philippines
- South Luzon Thermal Energy Corporation
- Sree Jayajothi Cements Limited - India
- Billiton Holdings Pty Ltd - Australia
- White Energy Company Limited
- Offshore Bulk Terminal Pte Ltd, Singapore
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Power Finance Corporation Ltd., India
- Binh Thuan Hamico - Vietnam
- Mintek Dendrill Indonesia
- CIMB Investment Bank - Malaysia
- Karaikal Port Pvt Ltd - India
- Goldman Sachs - Singapore
- Anglo American - United Kingdom
- MS Steel International - UAE
- Parliament of New Zealand
- Sindya Power Generating Company Private Ltd
- Toyota Tsusho Corporation, Japan
- Eastern Coal Council - USA
- European Bulk Services B.V. - Netherlands
- Wood Mackenzie - Singapore
- Indo Tambangraya Megah - Indonesia
- Videocon Industries ltd - India
- India Bulls Power Limited - India
- Orica Mining Services - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Kobexindo Tractors - Indoneisa
- Vedanta Resources Plc - India
- Parry Sugars Refinery, India
- Global Green Power PLC Corporation, Philippines
- Salva Resources Pvt Ltd - India
- Minerals Council of Australia
- Interocean Group of Companies - India
- Mercator Lines Limited - India
- Semirara Mining and Power Corporation, Philippines
- Bharathi Cement Corporation - India
- Cement Manufacturers Association - India
- Baramulti Group, Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Coal and Oil Company - UAE
- Pendopo Energi Batubara - Indonesia
- Deloitte Consulting - India
- GN Power Mariveles Coal Plant, Philippines
- Grasim Industreis Ltd - India
- Electricity Generating Authority of Thailand
- Asmin Koalindo Tuhup - Indonesia
- Intertek Mineral Services - Indonesia
- Ind-Barath Power Infra Limited - India
- Xindia Steels Limited - India
- Kartika Selabumi Mining - Indonesia
- International Coal Ventures Pvt Ltd - India
- Timah Investasi Mineral - Indoneisa
- PowerSource Philippines DevCo
- Bukit Baiduri Energy - Indonesia
- Thai Mozambique Logistica
- Manunggal Multi Energi - Indonesia
- Renaissance Capital - South Africa
- Eastern Energy - Thailand
- Orica Australia Pty. Ltd.
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Madhucon Powers Ltd - India
- Indogreen Group - Indonesia
- Metalloyd Limited - United Kingdom
- PTC India Limited - India
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