TheisenSPI©

How is the SPI Price determined?
Using analytics developed and tested over the last 8 years for shipping banks, the SPI Price for any particular ship is based on the correlation in history of the observed market price for the same ship sub-type, age and capacity with its replacement newbuilding cost (derived from shipyard orders, steel prices and exchange rates), its time charter earnings and scrap value. Using the latest month's data inputs for these same drivers produces a calculkated price for both newbuildings and second-hand ships that should be paid by the market today to reflect similar circumstances in the past. The actual current market price may be above or below the SPI Price depending upon current market expectations.

How accurate is the SPI Price comparred to observed market prices?
Statistically, the SPI Price compares well when compared to observed ship sale prices in the market. Comparing the differences between the SPI Price with the observed Average Market Price of all ships in each month over the last 3 years the difference between the calculated SPI Price and the Average Market Price for young ships was +/-5%, for mid-aged ships +/-10% and for older ships +/- 12.5%. Theisen use the percentage difference and not the absolute difference as this is a more relevant measure of accuracy.

The normal distributions shown below represent the distribution of the percentage difference for all ship sub-types between the average observed price in the market over the last 3 years and the calculated TheisenSPI price using correlation drivers drawn from 10 years of history. The shaded areas represent where 68% of the prices fell for each age of ship (1 standard deviation either side of the mean of 0% difference) and the outer boundaries of these 68% shaded areas are the +/- percentage differences mentioned above. The red dots are the individual sample differences (all ages sample size 2,800). However, the SPI Price shows what the market price "should be" today when compared to market prices in history - as mentioned above current market prices may be above or below the SPI Price - the SPI Price should not necessarily be the same as the current market price.

New build comparison chart 5 year old comparison chart

10 year old comparison chart 15 year old comparison chart