$EURN (+3,8%) which is now called CMB:TECH

The shipping industry is a dynamic market characterized by geopolitical tensions, global trade flows and technological innovation. My current portfolio focuses on the tanker sector, which is currently benefiting from high freight rates and attractive dividends. But the future belongs to the dry bulk sector, which is driven by long-term trends such as urbanization and infrastructure projects. This strategy shows how I am gradually rebuilding my portfolio - with a clear focus on when tankers will remain attractive and when the bulk sector will gain in importance.

Exemplary tanker portfolio

The portfolio consists of 9 diversified tanker stocks that deliver high returns:

- Scorpio Tankers ($STNG (-1,43%)): 20 %

- TORM ($TRMD A (-2,33%)): 20 %

- Teekay Tankers ($TNK (-1,34%)): 15 %

- International Seaways ($INSW (-1%)): 15 %

- DHT Holdings ($DHT (-0,8%)): 10 %

- Frontline ($FRO (-1,76%)): 10 %

- Euronav ($EURN (+3,8%)): 10 %

- Hafnia ($HAFNI (+0,22%)): 5 %

- Okeanis Eco Tankers ($OET (+0,5%)): 5 %

Why tankers are currently attractive:

- High freight rates: Geopolitical tensions such as sanctions against Russia are driving demand for oil transportation.

- Long routes: Detour via the Cape of Good Hope increase ton-mile demand.

- Attractive dividend yields: Many of these companies pay double-digit dividends.

Time horizon for tanker investments:

According to forecasts, the tanker market will remain stable until the end of 2025 as demand for crude oil transportation grows slightly (+2.5-3.5 %) and fleet capacity increases moderately (+1.2 %) [1][2]. From 2026, however, freight rates could be expected to fall if ships start using shorter routes again and demand for oil decreases due to the energy transition [3][5].

Why the bulk sector will become attractive in the long term:

The dry bulk sector offers sustainable growth through:

- urbanization and infrastructure projects in emerging markets such as China and India.

- Diversity of transported goodsincluding iron ore, coal, grain and bauxite.

- Technological innovationssuch as low-emission ships and digital optimization.

Time horizon for the bulk sector:

The bulk market will go through a slight phase of weakness until the end of 2025 (-1 to -2 % growth in demand) before picking up again from 2026 (+2-3 %) [3][7]. In the long term, annual growth of around 4-6% is forecast, driven by rising demand for raw materials and fleet modernization [4][19].

My strategy: conversion with dividends

Phase 1 (2025-2026): Focus on tanker dividends

The high dividends from my tanker portfolio will be used to gradually build up positions in the bulk sector. Meanwhile, I hold my tanker stocks as they will remain stable until at least the end of 2025.

Phase 2 (from 2026): Expansion of the bulk portfolio

With the expected decline in the attractiveness of the tanker market from 2026, I am planning a gradual shift into the following bulk stocks:

- Star Bulk Carriers ($SBLK (+0,25%)): Market leader with a high dividend yield (~13%) and a diversified fleet.

- Genco Shipping ($GNK (-0,35%)): Solid US company with a focus on low debt and sustainable distributions (~11%).

- Golden Ocean Group ($GOGL (-2,72%)): Specializes in capesize ships with attractive yields (~15%).

- Pacific Basin Shipping ($2343) (+0,51%)Leading in the Handysize segment with stable yields (~6 %).

- Safe Bulkers ($SB (-1,99%)): Focus on energy-efficient ships and grain transportation (~5-6%).

I also add strategic stocks to my portfolio:

- Fortescue Metals Group ($FMG (+0,27%)): Iron ore producer with a high dividend yield (~10%) and a strong focus on green technologies.

- Mitsui & Co Ltd. ($8031 (+0,94%)): Diversified company with interests in the bulk sector and investments in sustainable ship technologies.

Phase 3 (from 2030): Long-term consolidation

By the end of the decade, my portfolio should be fully focused on the growing bulk sector. I will focus on companies that benefit from technological innovations and sustainable practices.

Why this strategy works

1. income generation:

- The high dividends from my tanker stocks finance the build-up of a growth-oriented bulk portfolio.

2. long-term growth potential:

- The bulk sector benefits from global megatrends such as urbanization and infrastructure development.

3. diversification:

- The combination of different shipping segments reduces the risk of market fluctuations.

4. sustainability:

- Investments in companies with a focus on green technologies ensure long-term competitiveness.

Conclusion

With this strategy, I am making the most of the short-term earning power of my tanker portfolio, while at the same time building a future-proof portfolio in the dry bulk sector. The planned time horizon allows me to react flexibly to market developments and maximize both short-term profits and long-term growth.

Through targeted shifts into stocks such as Star Bulk Carriers or Fortescue Metals Group, I am creating a solid basis for sustainable success - in an industry full of opportunities!

Disclaimer: This article was created with the support of an AI. However, the specific questions, content and strategic direction were provided by me.

@Jo_Wolf
@AlterMann

Sources

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[2] BIMCO Q3 2024: Tanker shipping market outlook - Safety4Sea https://safety4sea.com/bimco-q3-2024-tanker-shipping-market-outlook/

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