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Tullett Prebon forms wet freight derivatives venture

Tullett Prebon, part of Collins Stewart Tullett, is the latest interdealer broker to partner with a shipping broker to offer forward freight agreements (FFAs). It has started a venture with three international shipping brokers with the aim of capitalising on the $4.5 billion wet freight derivatives market.

Forward freight agreements (FFAs) are paper contracts based on any agreed shipping route fixed against the Baltic index, which allows market participants to trade against volatility in the underlying freight market.

Tullet says the move will bring together the experience of its existing inter-dealer broking business with the physical shipping expertise of three ship-broking companies, London

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