Some rebuilding of the basket this month.
Initially it was just more FLNG, followed by another CLCO nibble.
Then the FRO-EURN news broke. Initial data only said 24 VLCC would transfer over - no idea which vessels. Now it is known data - the 24 newest VLCCs in EURN’s fleet of 41 VLCCs. I don’t mind the price - avg of $98M per VLCC. The problem is the initial financing. It looks like the shares FRO tenders in to CMB/Saverys serves as the equity, about 10.7% with the rest being financed.
If quarterly revenue in the tanker sector was more stable, I would be less nervous. But, the sector has a really bouncy pattern, and VLCC rates have not recovered as quickly as Suezmax and Aframax rates in Oct 2023. Yes, a FRO share price bounce occurred, and I just waited on the sidelines. I had a “disallowed loss” FRO event that was restraining me slightly. The more significant “restraint” though, … me just worried about the unreasonable expectations placed on the FRO Q3 dividend.
There are/were other ways to play a tanker bounce. And I did that with a STNG nibble and two TRMD nibbles. Scouring the crude tanker ideas, INSW and TNK looked appealing. During the month, I also cleared most of the GOGL stake when share price crossed $8, and just nibbled back today (10/31)
Top holdings
FLNG 29.69%
FRO 22.25%
CLCO 12.04%
TRMD 8.75%
NMM 7.44%
GSL 6.76%
Remaining percentage spread between GOGL, TNP-E, SB, BDRY, STNG, SFL, SBLK, DSX, ZIM
Now I wait for the Q3 results and make my plans to adjust before and after results (more so on the tanker ideas)