The purpose of this dissertation is to investigate if the Baltic Capesize Index is a good proxy foractual Capesize earnings and why they deviate. The results may implicate if forward freightagreements are suitable for revenue management in practice. This because forward freightagreements are bought and held through maturity, and by definition, forward prices will convergeto spot prices as they reach maturity. What matters is therefore the difference between spot indexand actual earnings.The dissertation is based on a simulation approach where both single linear regression and thedollar-offset method are used to evaluate how good proxy the Baltic Capesize Index is. Ourfindings indicate that actual earnings are most affected by the basis risks geography and timing,and the “lag” before changed market conditions are reflected in actual earnings. Linear regressionand the dollar-offset method are ambiguous whether the Baltic Capesize Index is a good proxyfor actual Capesize earnings. To conclude whether the Baltic Capesize Index is a good proxy it istherefore necessary to conduct more research on which methods that are appropriate withinshipping.
展开▼
