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http://dx.doi.org/10.5394/KINPR.2019.43.1.72

Panamax Second-hand Vessel Valuation Model  

Lim, Sang-Seop (Division of Shipping Management, Korea Maritime and Ocean University)
Lee, Ki-Hwan (Division of Shipping Management, Korea Maritime and Ocean University)
Yang, Huck-Jun (Busan Development Institute)
Yun, Hee-Sung (Centre for Shipping Big Data Analytics, Korea Maritime Institute)
Publication Information
Journal of Navigation and Port Research / v.43, no.1, 2019 , pp. 72-78 More about this Journal
Abstract
The second-hand ship market provides immediate access to the freight market for shipping investors. When introducing second-hand vessels, the precise estimate of the price is crucial to the decision-making process because it directly affects the burden of capital cost to investors in the future. Previous studies on the second-hand market have mainly focused on the market efficiency. The number of papers on the estimation of second-hand vessel values is very limited. This study proposes an artificial neural network model that has not been attempted in previous studies. Six factors, freight, new-building price, orderbook, scrap price, age and vessel size, that affect the second-hand ship price were identified through literature review. The employed data is 366 real trading records of Panamax second-hand vessels reported to Clarkson between January 2016 and December 2018. Statistical filtering was carried out through correlation analysis and stepwise regression analysis, and three parameters, which are freight, age and size, were selected. Ten-fold cross validation was used to estimate the hyper-parameters of the artificial neural network model. The result of this study confirmed that the performance of the artificial neural network model is better than that of simple stepwise regression analysis. The application of the statistical verification process and artificial neural network model differentiates this paper from others. In addition, it is expected that a scientific model that satisfies both statistical rationality and accuracy of the results will make a contribution to real-life practices.
Keywords
Panamax Second-hand Ship Price; Artificial Neural Networks; Stepwise Regression;
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Times Cited By KSCI : 1  (Citation Analysis)
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