Optimal Portfolio for LNG Importation in Korea Using a Two-Step Portfolio Model and a Fuzzy Analytic Hierarchy Process

Round 1

Reviewer 1 Report

This is an interesting piece of paper. I have only a few comments.

The two-step portfolio model was described, but there's no description about the fuzzy AHP. The authors should provide information what the fuzzy AHP is and how the fuzzy AHP is applied to calculate weights.

The authors could improve the conclusion section, thereby emphasizing how the findings are applied to the LNG policy in detail. 

Author Response

We are pleased to have been given the opportunity to revise the manuscript entitled “Optimal portfolio for LNG importation in Korea using a two-step portfolio model and a fuzzy analytic hierarchy process.” We would like to greatly thank the three reviewers for their time and effort in providing such insightful guidance. We have done our best to address each of your concerns point by point as outlined below. All revisions were highlighted using the "Track Changes" function in Microsoft Word. For the English language and style issues, the manuscript was edited by a professional editor in MDPI.

This is an interesting piece of paper. I have only a few comments.

The two-step portfolio model was described, but there's no description about the fuzzy AHP. The authors should provide information what the fuzzy AHP is and how the fuzzy AHP is applied to calculate weights.

(Response) We appreciate your good evaluation on the paper. We totally agree with you. We added the explanation on fuzzy AHP application in the section 2.2. The purpose, procedure, and related literatures were describe following your comment.

The authors could improve the conclusion section, thereby emphasizing how the findings are applied to the LNG policy in detail. 

(Response) Thank you for the useful comment. We tried to elaborate the conclusion section. Based on the optimal portfolio results, we suggested goals and direction of Korea's LNG importation policy. 

Author Response File: Author Response.pdf

Reviewer 2 Report

L42: tautology "is required because the exporting country is required"

Liquefied natural gas (LNG) production is relatively new technology on energy market, which can potentially change the geopolitical energy balance in the World. Authors mention attention this fact indirectly. Maybe it is worth to present some ideas on this point in conclusions.

Authors provided professional styled block-diagram

Interesting descriptions of such risks as  "the risk of transportation, the risk of natural disasters, the economic risk, and the national risk"

The portfolio optimization problem is an old topic, but authors provided new insights on specific risks estimation.

Please, provide more detailed descriptive statistics on price data.

Figure 2: Add in caption for which commodity you show the prices. This chart looks unprofessional. You can improved it by adding more descriptive statistics, for example standard deviation bands, some artificial modeled line etc.

Tables 5-8. Maybe one comprehensive table for all risk types is enough, save the space.

I suggest remove unnecessary grid from your charts. Good science style is to present only significant information, leaving the other space blank.

Good theory about "The Visual Display of Quantitative Information" you can find in Tufte "Artful sentences: syntax as style"

Author Response

We are pleased to have been given the opportunity to revise the manuscript entitled “Optimal portfolio for LNG importation in Korea using a two-step portfolio model and a fuzzy analytic hierarchy process.” We would like to greatly thank the three reviewers for their time and effort in providing such insightful guidance. We have done our best to address each of your concerns point by point as outlined below. All revisions were highlighted using the "Track Changes" function in Microsoft Word. For the English language and style issues, the manuscript was edited by a professional editor in MDPI.

Liquefied natural gas (LNG) production is relatively new technology on energy market, which can potentially change the geopolitical energy balance in the World. Authors mention attention this fact indirectly. Maybe it is worth to present some ideas on this point in conclusions. 

Authors provided professional styled block-diagram. Interesting descriptions of such risks as "the risk of transportation, the risk of natural disasters, the economic risk, and the national risk". The portfolio optimization problem is an old topic, but authors provided new insights on specific risks estimation.

L42: tautology "is required because the exporting country is required" 

(Response) We admit our mistake. We revised the sentence as “a long-term project period is required because the exporting country must build a large-scale infrastructure for transportation” in the line 42.

Please, provide more detailed descriptive statistics on price data. 

(Response) Thank you for the useful comment. We added descriptive statistics on price data in Table 5.

Figure 2: Add in caption for which commodity you show the prices. This chart looks unprofessional. You can improved it by adding more descriptive statistics, for example standard deviation bands, some artificial modeled line etc.

(Response) Following your comment, we added the legend into the figure and a change rate of prices which were used in the portfolio analysis.

Tables 5-8. Maybe one comprehensive table for all risk types is enough, save the space.

(Response) Thank you for your helpful comment. We have consolidated each table into one comprehensive table, Table 6.

I suggest remove unnecessary grid from your charts. Good science style is to present only significant information, leaving the other space blank. Good theory about "The Visual Display of Quantitative Information" you can find in Tufte "Artful sentences: syntax as style"

(Response) Thank you for the useful comment. We removed unnecessary grids in the graphs. The graphs were also revised in a consistent format. Thank you again for the helpful advice.

Author Response File: Author Response.pdf

Reviewer 3 Report

The approach they have chosen for this paper is really interesting, but the data should be presented in a consistent format for the graphs. Every graph has a different format. 

Fuzzy AHP?? The word fuzzy is too informal for a research paper.

Author Response

We are pleased to have been given the opportunity to revise the manuscript entitled “Optimal portfolio for LNG importation in Korea using a two-step portfolio model and a fuzzy analytic hierarchy process.” We would like to greatly thank the three reviewers for their time and effort in providing such insightful guidance. We have done our best to address each of your concerns point by point as outlined below. All revisions were highlighted using the "Track Changes" function in Microsoft Word. For the English language and style issues, the manuscript was edited by a professional editor in MDPI.

The approach they have chosen for this paper is really interesting, but the data should be presented in a consistent format for the graphs. Every graph has a different format. 

(Response) We appreciate your good evaluation on the paper. Following your comment, we tried to revise the graphs in a consistent format.

Fuzzy AHP?? The word fuzzy is too informal for a research paper.

(Response) Yes, the word “fuzzy” might be an informal word for a research paper. However, we kept the word since “fuzzy AHP” has commonly been used in the papers on the AHP field. Please reconsider the usage of the word fuzzy in our paper.

Author Response File: Author Response.pdf