Research On Contract Pricing Model Of Marine Container Hybrid Option Based On Binary Tree

Container liner transport is the most important mode of maritime transport.With the rapid development of the Chinese shipping industry,more and more shipping enterprises are engaged in container liner transportation.The tendency of ship size enlargement is obvious.In container liner transportation,the growth of capacity supply exceeds the growth of customer demand,resulting in excess capacity,and the contradiction between supply and demand in the market.In the fierce competition of the shipping market,the fluctuation of container freight is more drastic,which brings huge risks to the participants of the container shipping market.Therefore,there is an urgent need for risk management and formulation of appropriate pricing strategies.In addition,domestic container liner shipping companies often use negotiated price contracts to transport goods to customers with large and stable batches.In addition,the domestic container liner transportation enterprises for large and stable volumes of customers use the contract price contract to carry out freight.However,this pricing method lacks flexibility in the abnormal fluctuation of freight volume or market freight rate,which easily to causes unilateral losses.To solve the above problems,this thesis is based on the idea of dynamic pricing,a pricing strategy is introduced into the pricing contract and gives a pricing strategy by using the binomial trees,which provides the basis for the optimal decision of both parties.The main research contents of this thesis are summarized as follows:(1)In order to increase the flexibility of the pricing strategy,introducing option theory into negotiated price contracts,a new type of hybrid option contract is established to maximize the expected benefits for both parties.The established unilateral and bilateral single-period binary tree pricing models separately single-period binary tree pricing model give the optimal option booking volume and the optimal option execution price.Through the comparison of hidden profit,the characteristics of the income change of the two parties of various contracts are analyzed.The research results show that in the face of fluctuations in market freight rate and actual freight volume,the change of implicit profit of hybrid option contract is relatively stable,which can reasonably reduce the shipper’s transportation cost,reduce the carrier’s empty box risk and facilitate the establishment of stable cooperation relationship.The sensitivity analysis shows that the optimal option execution price is positively correlated with the agreement price and the agreed space booking volume,while it is negatively correlated with the order quantity.Optimal option booking volume is negatively correlated with agreed booking volume.(2)In order to better face the complexity of freight price fluctuation in long-term freight transportation,considering both rising and falling prices in the maritime market,the bilateral multi-period binary tree hybrid option contract is constructed based on maximizing the expected profits of both parties.The optimal option booking volume and the optimal option exercise price are given to improve the flexibility of the pricing strategy and balance the risks brought by freight volume and price fluctuation to both underwriters.The research results show that when faced with fluctuations in market freight rates and actual freight volume,pricing models can enhance the risk management capabilities of both parties.When the gap between the actual demand and the total booking capacity is small,the hybrid option contract can give the carrier a smaller hidden profit and reduce the loss of the carrier.Conversely,when the gap between the actual demand and the total booking volume is too large,the profit of the carrier in the model built is low.However,it can help shippers avoid the risk of price fluctuations,which is conducive to locking in the source of goods in advance and avoiding the risk of empty containers.The sensitivity analysis results show that the optimal option exercise price is positively correlated with spot market freight rates and short-term preparation costs,while it is negatively correlated with long-term preparation costs.The optimal option order quantity is positively correlated with the current price,and negatively correlated with the option cost and the option exercise price.