Mark, here are some words on how it works

tks

 -----Original Message-----
From:  Duggan, Caroline  
Sent: 25 May 2001 16:22
To: Quick, Robert; Aziz, Arfan
Subject: Re: Worldscale Pricing

FYI on worldscale pricing


----- Forwarded by Caroline Duggan/LON/ECT on 25/05/2001 16:26 -----


	Scott Moncrieff 11/10/2000 16:41 	  To: Anna Gardiner/LON/ECT@ECT  cc: 
Caroline Duggan/LON/ECT@ECT, Robert Quick/LON/ECT@ECT  Subject: Re: 
Worldscale Pricing



e.g. 
somebody buys the spread at worldscale 210 for november. they buy 16 
contracts (5000 mts each)
to emulate a 80,000 voyage cross north sea. 
(the current market say is 200 / 210)

the spot market goes through the roof, and the average for november ends up 
to be 220

settlement is 5000 x 16 = 80,000 mts x 3.50 x 220% minus 80,000 mts x 3.50 x 
210% 
   = $616,000 -  $588,000  = $28,000 settlement figure. 

so the worldscale 'spot' rate is a percentage of the flat rate (3.50) for the 
voyage in question
i.e. the spot market at the moment is worldscale 205 which means the 
equivalent $/pmt rate is 3.50 x 205% = $7.175




Anna Gardiner
11/10/2000 16:23
To: Scott Moncrieff/LON/ECT@ECT
cc: Caroline Duggan/LON/ECT@ECT 

Subject: Worldscale Pricing

Scott

Could you let me know in writing you the full calculation for reaching your 
current dollar price that you are offering on EOL.  I understand that you are 
basing it from your flat rate price of 3.50.  I would also like to know if 
the worldscale rate is always a set percentage of the USD rate or does it 
ever fluctuate?

Thanks

Anna