New Imarex Freight Options set to increase the overall size of freight derivatives market

With the introduction of Imarex Freight Options (IFOs), Imarex is taking the step from being the world's only Freight Futures exchange, to being the only fully fledged Futures and Options market for freight - now worth over US$30 billion per year.

"Cleared Options contracts are the next big thing in this market," says Tom Even Mortensen, Imarex Managing Director. "The shipping industry will at the beginning of June, for the first time in history, have a fully functioning options market associated with ocean freight - another first for Imarex," he adds.

 
IFOs are a way to gain from a movement in a freight price without actually purchasing freight or a freight contract outright. The market for freight options is moving fast.

Imarex estimates that the future size of the freight options market could match the current size of the freight futures market, thereby increasing overall the size, and potentially the value of the entire freight derivatives market.

"By introducing cleared Options to the freight industry, we're strengthening our position as the leading innovator and investor in this market," says Mortensen.
 

Imarex and NOS (the Norwegian Futures and Options Clearing House) have over the last few years successfully built a financial market for freight. Since 2001, NOS and Imarex have worked closely with ALL members of the freight derivatives market to build a cost efficient, coordinated market place especially suited to the complex business of shipping.
 

As the world’s only specialised clearing house for freight futures and options, NOS is the safe-harbour for participants in the freight derivatives market.
 

By offering Futures on 12 tanker routes and 7 drybulk routes and Options on the most liquid trading routes, Imarex is again showing its commitment to investing in growing the liquidity of the market. "Trading will always go where there is liquidity because that's where the opportunities for profit are," Mortensen says.

Imarex will initially offer monthly IFOs for the entire forward curve of a freight futures contract.
 

The growing list of Imarex members traded freight futures worth over US$4.5 billion on Imarex in 2004.
 

Imarex expects membership of the exchange to exceed 100 full members this quarter. "We have over 75% of all currently active freight derivatives principals looking at our screens," says Mortensen. "Our focus is to bring new products and new principals to the market, to boost the liquidity of freight derivatives - it's what our members and our shareholders want," he adds.

For more info please contact:
 
Tom Even Mortensen, Managing Director  tel: +47 2389 4200
Mikal Bøe, Director of Information Services  tel: +47 2389 4227

About Freight Options:
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Imarex Freight Options are a way to gain from a movement in a freight price without actually purchasing freight or a freight futures contract outright. The market for freight options is moving fast, and Imarex estimates that the value of the freight options market could match the value of the freight futures within a relatively short time period.  One buys a "call" option if one thinks a price is going to go up and a "put" option if one thinks a price is going to go down. The cleared Imarex Freight Options are financially settled Asian style put and call Options with monthly settlement.