Shares & Derivatives
Why Courage Marine is falling
By Investment Moats  •  September 18, 2008
By: Drizzt Readers would have note that Courage Marine and many of the dry bulk shipping counters were badly affected these few days. Courage marine fell to 21.5 cts as of latest closing. Courage Marine is tracked here at my Dividend Stock Tracker. Sure the overall market was badly affected sentiment wise by the news of Lehmen, Merrill Lynch and AIG but then the Baltic Index wasn’t doing very well either. Hard Asset Investor Wrote in this article explaining more of this: The last time we looked at shipping was all the way back in April. At the time, we commented on the new entrants into the index market for dry bulk shipping - UBS and their Blue Sea Index. Six months later, we have another new entrant; this time in the form of an actual, investible exchange-traded fund. A quick refresher: Shipping rates are tracked primarily by the Baltic Dry Index, a blending of the rates to ship dry goods (largely ores) on three different-sized boats on the four main shipping routes. Back then, we safely commented that nobody was actually doing much in the way of derivatives on the BDI beyond freight forward agreements. In other words, for most investors, it was functionally untradable. It turns out not having some kind of derivatives=based Baltic Dry ETF was a blessing in disguise. Since a heady peak in early summer, the BDI has lost an astonishing 50% of its value.

 

Chart: Baltic Dry Index 3/13/08 - 9/12/08

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By Investment Moats
Investment Moats is set up by Kyith Ng and have been around since 2005. He aims to share his experiences making sense of money, how money works and ways to grow his money. It hopes that by sharing his experiences, both good and bad, season investors can advice and critique his decisions and new investors can learn from them and find their own style ...
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