This course is designed to be taken after Freight Derivatives & Shipping Risk Management, but is suitable for experienced freight traders.

This advanced two day module focuses on pricing freight options, modelling freight rate dynamics and pricing options on freight. It covers constructing forward curves on freight, modelling freight rate volatility as well as hedging and trading strategies using FFA and freight options.

Click here to download the course brochure.

Course leaders
Prof. Amir Alizadeh   Centre for Shipping, Trade & Finance  Bayes Business School (former Cass Business School)
Prof. Nikos Nomikos Centre for Shipping, Trade & Finance Bayes Business School (former Cass Business School)

The course leaders, Prof. Amir Alizadeh and Prof. Nikos Nomikos of Bayes Business School (former Cass Business School), are both internationally recognised academics in the fields of shipping and commodity finance, and risk management. Their theoretical and applied research work has been published in leading academic and professional journals and they also provide consultancy services to the industry on different aspects of commodity and shipping risk management.

To book a place please email  [email protected] or call +44 (0)20 3326 8465/8460

Part One

Introduction to the freight market

  • Freight contracts
  • Characteristics of the freight market
  • Relationship between spot and time-charter freight rates

Forward Freight Agreements

  • Practicalities of trading
  • Hedging and trading examples

Spot price dynamics

  • Mathematical models for freight rates
  • Mean reversion, seasonality and jump diffusion models
  • Estimating and setting up models

Forward curves

  • Forward curve construction

Technical analysis & freight trading

  • Chart analysis
  • Technical trading rules
  • Spread trading
  • Implied TC rates

Risk management using options

  • Freight options
  • Hedging with options
  • Option trading strategies

Part Two

Modelling freight rate volatility

  • Volatility models: Historical, time-varying and implied
  • Estimation and interpretation
  • Forecasting volatility
  • Pricing freight options
  • Determinants of option prices
  • Pricing Asian options using closed-form models
  • Monte Carlo Simulation

Real options in shipping

  • Key option value drivers
  • Different types of real options
  • Option to choose (spot vs time-charter)
  • Option to lay-up
  • Real options and ship valuation
  • Real options and extended Net Present Value
  • Identifying & valuing real options in shipping

Writing and risk management of option positions

  • Option price sensitivities (Greeks)
  • Dynamic & Static Delta Hedge
  • Delta-Gamma hedging
  • Greeks & Asian options

Value at Risk of shipping freight rates

  • Estimation & interpretation
  • VaR methodologies
  • VaR for nonlinear instruments


Terms and conditions

The Baltic Exchange must be in receipt of full payment before access to the course is granted. Each delegate is provided with 180 days access to the course. If you fail to complete the course in 180 days, then you may extend the course by paying a change fee (£50 + vat per 30 days).

No course material may be copied or reused without the permission of the Baltic Exchange. You must not allow any third party to use your account information and/or computing equipment to access the digital content or course that you have booked.

You may only print off any course materials for your own personal use. You must not provide, offer to sell, license or transfer the course materials (whether in whole or in part in any manner or form or in or on any media) to any other person unless we have agreed to this in writing.

In the event that we are unable to deliver classroom learning due to events beyond our control, delegates will be offered the choice of a discounted online only option, refund, reschedule to a future date, or access to an additional online course.

30% discount is available for employees of corporate member firms of the Baltic Exchange, up to and including the company’s number of individuals nominated as named Baltic Exchange members.

Further questions

Please contact Bill Lines on: 
Tel:  +44 (0)20 3326 8460

Email:  [email protected]

Previous Attendees

Run since 2005, this course has been attended by a huge range of shipowners, charterers, brokers and financial institutions with an exposure to the bulk shipping markets. These include:

A Bilbrough & Co
Aalborg Portland
ABN Amro Futures
Aegean Baltic Bank
AET Tankers
Alfred C Toepfer International
AM Nomikos
Amarante Shipping
Anglo American
Aquila Maritime Management
ArcelorMittal Treasury
Archer Daniels Midland
Arista Shipping
Augustea Shipping Services
AWB Singapore
Bank of Ireland
Bank of Nova Scotia
BHP Billiton
BHP Billiton Marketing Asia Pte
Bibby Line
BNP Paribas
BP Shipping
Brave Maritime
Brunei Gas Carriers
Business Intelligence Group
Calyon Asia Shipfinance
Cape Tankers
Castalia Fund Management (UK)
CBH Group
CC Maritime
Chandris (Hellas)
China Navigation Co
Chinese Maritime Transport
Clipper Bulk
Clipper Group A/S
Coal & Oil Company
ConocoPhillips International
Constellation Energy
Conti Reederei
CSAV Norasia Liner Services
CSL Asia Shipping
CSL International Inc.
D’Amico Dry
Dae Yang Shipping
Dome Chartering
Drax Power
DVB Bank
Dynacom Tankers
Eastport Maritime
Eastern Bulk Carriers
EDF Trading
Eitzen Bulk
Electric Power Development Co
Emarat Maritime
Emirates Ship Investment Co
Enel Trade
Energy Argus
Equinox Maritime
Excel Maritime Carriers
Financial Conduct Authority
FinnFleet Tankers
Fitch Risk
Fokus Bank
Freight Investor Services
GE Transportation Finance
Gestion Maritime
Getax Ocean Trades
Global Harvest Trading
Glory Ship Management
Golden Ocean Management
Great Eastern Shipping Co
Harmony Shipping
HF Navigator
Hochu Petroleum
Holman Fenwick Willan Singapore
Honors Commodity Singapore
HSH Nordbank
Hua Dao Shipping (The East)
Iino Shipping
Ispat Industries
J. Lauritzen USA
Jerra Global Markets
Jiaotong University
John F Dilon
Klaveness Asia Pte Ltd
Kredittbanken ASA (Osloavd)
Laskaridis Shipping
Leros Management
M2M Management
M Maritime
Maersk Tankers
Maritime 24
Maritime and Port Authority of Singapore
McTaggart Shipping & Management
Mercator Lines (Singapore)
Merrill Lynch Commodities
Midship Marine
Mitsui OSK Bulk Shipping (Europe)
Mitsui & Co
Mitsubishi Corp
Mittal Shipping
Motia Compagnia di Navigazione
MT Maritime Management
MUR Shipping
Murmansk Shipping
National Bank of Fujairah
Navico International
Nexus Management
Nidera Handelscompagnie
Nordic Bulk Carriers
North of England P&I Assoc
NorthEdge Risk Services
NYK Bulkship (USA)
Ocean Tankers
Oceania Impex
Odin Marine
Olam International
Oldendorff Carriers
OSG Ship Management
OW Bunker
Pacific Basin
Pacific Rim Shipping
Phoenix Bulk Carriers
Poten & Partners Inc
Power International
Prime Marine
Qawareb Ship Management
Quadra Commodities
RAG Trading
Redpath Sugar
Rio Tinto
Rio Tinto Shipping (Asia)
Royal Bank of Scotland
San Miguel Corporation
Scottish Power
Seasure Shipping
Seatrek Trans
Sims Metal Management
Singapore Exchange
Siva Bulk Shipping
SK Corporation
SK Shipping Co. Ltd
Sociedad Naviera Ultragas
SS Freight Solutions
Standard Chartered Bank
Summit Maritime
Tailwind Shipping
Taipan Shipbrokers
Tai Chong Chiang Steamship
TBS Shipping Services
The Lion Group
Thoresen & Co. (Bangkok) Ltd.
Thurlestone Shipping
Torvald Klaveness
Total Gas & Power
Total Energies Trading
Tradition Financial Services
Transcenden Global
Transglobal Chartering
Triple Point Technology
Unipec UK
United Arab Shipping Company
V Bulkers
Veson Nautical Corporation
Wallem Commercial Services
Waterfront Chartering
West Asia Maritime
Western Bulk