Good way to play a rebound in BDI

Tsing Tao

Tsing Tao

Not sure if there's an ETF out there or not, just curious if anyone knows what the easiest way to play a rebound in the Baltic Dry Index would be?

SEA comes to mind, but was curious if others had any thoughts.
 
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Personally I would look to see a recovery in Aussie Dollar, Kiwi Dollar and Canadian Dollar if BDI turns upward. I have made this trade several times in the past. I have already started to leg into this by building a position slowly in the AUD. Unless China goes into a death spiral i see this as a core trade for 2015.
 
Those commodity currencies are highly exposed to risk, though, and you could get a spike down in a flash. As for shipping companies, that's why I mentioned SEA. I'd rather not have direct exposure to any one company who might not be able to weather the downturn.
 
Not sure why you want to buy a bombed out freight index...in the hopes China will maintain >7% growth rates? Well whatever floats your boat, check out the following equities: (I dug them out from a slightly older source, you would need to check whether they weathered the last 2008 storm):

SBLK Star Bulk Carriers Corp NASDAQ
DRYS Dryships Inc. NASDAQ
DSX Diana Shipping Inc NYSE
EGLE Eagle Bulk Shipping Inc NASDAQ
GNK Genco Shipping & Trading Ltd NYSE
EXM Excel Maritime Carriers Ltd NYSE
TBSI TBS International Ltd NASDAQ
PRGN Paragon Shipping Inc NASDAQ
NM Navios Maritime Holdings Inc NYSE
JIN.OL Jinhui Shipping OSE
NMM Navios Maritime Partners LP NYSE
FREE FreeSeas Inc. NASDAQ
 
Tsing Tao said:
Not sure if there's an ETF out there or not, just curious if anyone knows what the easiest way to play a rebound in the Baltic Dry Index would be?

SEA comes to mind, but was curious if others had any thoughts.
More...


Forget the other thoughts. SEA is the best. Go for it.
 
That is actually quite incorrect. R^2 between BDI and most of my listed shippers is higher than SEA over the past year as well as longer periods (I posted an image, perusing daily closing prices over the past 5 years)

Correl.JPG



bgk said:
Forget the other thoughts. SEA is the best. Go for it.
More...
 
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