Danish owner-operator Norden is expanding its freight derivatives desk and team with a new hire and is rolling out algorithmic trading.
Per Heilmann has joined the Copenhagen-listed company as head of forward freight agreement (FFA) and algorithmic trading and will be tasked with leading the expansion.
Norden, which has a fleet of bulkers and product tankers, has been testing out algorithmic (algo) trading models, generating what it described as “profitable returns”.
Algorithmic trading is the executing of orders using automated pre-programmed trading instructions, that take into account variables such as time, price and volume.
“Today, our FFA days exceed our physical days,” chief operating officer Christian Vinther Christensen said on Thursday.
“We have built multiple trading algorithms to provide recurring profits and, equally importantly, valuable signals to our chartering people working the many regional markets. These models are a risk diversification of our outright market exposure, generating steady returns and base margins.”
Heilmann has 20 years’ experience with FFA trading. He worked previously in freight trading roles at Maersk Tankers, Castleton Commodities International and Heidmar.
“Advanced data analytics enables stronger predictions and business decisions in a fragmented and analogue industry,” he said.
“Norden has superior data analytics capabilities and I’m genuinely impressed with the data, trading and service-oriented culture at Norden, where there is a freedom to act within the risk limits of a superior risk framework.”
Norden said “rising market volatility, geopolitical complexity and digitalisation” are the main driving forces behind its focus on data, analytics and risk management.
Norden’s bottom line was $243.1m for the third quarter, up from $65m in the same period last year.
Much of the quarterly result was generated by its freight services & trading division, which oversees its operated fleet. The unit generated $190m in profit during the quarter, up year on year from $57m.
