ABSTRACT
This chapter provides a full description of the process underlying the collection of information, its processing in constructing freight rate indices and the presentation of all such indices available that serve or can potentially serve as underlying assets of freight rate derivatives. It describes in detail the composition of the dry-bulk and tanker freight rate indices, respectively. The chapter explores the liner segment, that is, to the composition and construction of the containership freight rate indices. It describes the well-known indices of the China (Export) Containerized Freight Index, the Shanghai Containerized Freight Index, the World Container Index, the Ningbo Containerized Freight Index and the Freightos Baltic Index. The Baltic Freight Index needed to be revised often in order to reflect the changing trading patterns and continue to be relevant and representative of the freight rate market.
