> For the complete documentation index, see [llms.txt](https://docs.dataloy.com/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.dataloy.com/release-8.28/voyage-management-system/step-by-step-guides/chartering/time-charter-contracts/maintain-time-charter-contracts/duration-and-rates/index-based-hire-rate.md). # Index-based Hire Rate Time charter hire is often agreed as a percentage of a published market index rather than a fixed rate. VMS supports this by linking a TC Duration's rates directly to a [Market Index](/release-8.28/voyage-management-system/step-by-step-guides/chartering/market-indices.md), so that hire amounts are calculated automatically as index values change over time. ### Before Enabling Index-Based Automation An index must be selected before automation can be activated. Once automation is on, the selected index cannot be removed. **1. Open the TC Duration** and expand the Duration Details view. **2. Scroll to the Index-Based Rate section.** **3. Select a Market Index** from the Index field. Once connected, the last updated date of the index values (in GMT) is shown. ### Configuration Fields | Field | Description | | -------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------- | | **Percent** | The percentage of the index rate to apply. For example, 95% means the TC rate is calculated as 95% of the averaged index value. | | **Index** | Market Index the TC rates should follow. Required before automation can be enabled. | | **Floor** | Optional minimum. The calculated TC rate will not fall below this value. | | **Roof** | Optional maximum. The calculated TC rate will not exceed this value. | | **Profit Sharing Percent** | Optional percentage of additional profits to be shared with owner, if the hire rate exceeds the set roof value. | | **Calculation Rule** | Determines how the TC rate is calculated when index values are missing for certain dates within the rate window. See Calculation Rule below. | | **Period Rule** | Controls which date window is used to source index values for the calculation. Defaults to Current Period. See Period Rule below. | ### How the Rate Is Calculated Each TC rate period is assigned a date window. VMS averages the Market Index Values within that window to produce the hire rate for the period. Index values come in two types: * **SPOT values** — published historical values for past dates. * **FORWARD values** — projected values for future dates. **Calculation Rule** — Determines how the TC rate is calculated when index values are missing for certain dates within the rate window. Applies to SPOT values only, future dates always use the latest available forward value regardless of the rule selected. | Rule | Behaviour | | ----------------------- | ------------------------------------------------------------------------------------------------------------------ | | **Exclude** *(default)* | Averages published index values over the window, excluding any dates not having a SPOT value in the system. | | **Previous** | Averages index values over the window, substituting the nearest prior registered value for any missing dates. | | **Next** | Averages index values over the window, substituting the nearest subsequent registered value for any missing dates. | *** ### Period Rule By default the TC rate for a period is calculated from the index values valid during that same period. The **Period Rule** field allows a different reference window, useful when the commercial agreement requires that hire be based on index values from the preceding period. A TC rate period is considered **actualised** when its end date is on or before today's date. | Option | Behaviour | | ------------------------------------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------- | | **Current Period** *(default)* | Calculates the TC rate from index values valid within the TC rate period. | | **Previous Period** | Calculates the TC rate from index values valid in the previous period. | | **Previous Period with Adjustments** | Uses previous period index values while the current period is open, switching to current period values once the period is actualised. See the logic table below. | #### Previous Period with Adjustments — Logic | Condition | Index values used | | --------------------------------------------------------------------------------- | ----------------------- | | TC rate period not yet actualised, and previous period **is** actualised | Previous TC rate period | | TC rate period not yet actualised, and previous period is **also not** actualised | Current TC rate period | | Current period **is** actualised | Current TC rate period | ### Manually Locking and Overriding a TC Rate When the agreed hire for a specific period differs from the index-calculated value, that TC rate can be locked and overridden without affecting the rest of the duration. When Index-Based Automation is active, each TC rate row displays a **triple-dot menu (⋮)**. #### Locking a Rate Row **1.** Click the ⋮ menu on the rate row to adjust. **2.** Select **Lock.** The rate field becomes editable for that row. **3.** Enter the agreed TC rate value. **4.** Save. The manual value is used for invoicing this period. All other rows continue to auto-calculate. #### Unlocking a Rate Row **1.** Click the ⋮ menu on the locked row. **2.** Select **Unlock.** **3.** Save. The system recalculates the rate from the index. The manual override is discarded. --- # Agent Instructions This documentation is published with GitBook. GitBook is the documentation platform designed so that both humans and AI agents can read, navigate, and reason over technical content effectively. Learn more at gitbook.com. ## Querying This Documentation If you need additional information that is not directly available in this page, you can query the documentation dynamically by asking a question. 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