A financial instrument used by companies to reduce the risk associated with adverse or unexpected weather. The seller of the derivative accepts the risk by charging a premium to the buyer: if nothing happens, the seller makes a profit, but if the weather turns bad, the company claims the money. Unlike insurance, weather derivatives cover high-probability events.
Related information about weather derivative:
- Weather derivative - Wikipedia, the free encyclopedia
The first weather derivative deal was in July 1996 when Aquila Energy structured a dual-commodity hedge for Consolidated Edison Co. The transaction involved ...
- Weather Derivative Definition | Investopedia
The investor who sells a weather derivative agrees to bear this risk for a premium . If nothing happens, the investor makes a profit. However, if the weather turns ...
- Introduction To Weather Derivatives
Oct 14, 2010 ... However, the inception of the weather derivative - by making weather ... Here we look at how the weather derivative was created, how it differs ...
- Weather Forecast | Weather Data | Derivative | Speedwell Weather
After a number of years of providing these for CME weather derivative reference sites, we will soon be releasing a pack of over 200. Subscribers will receive the ...
- Weather Derivative Definition from Financial Times Lexicon
The party that sells a weather derivative bears this risk for a premium and stands to earn a profit if the weather remains relatively stable, predictable or normal.
- Weather Derivative - Financial Dictionary - The Free Dictionary
A derivative security in which an investor hedges against the future state of the weather. For example, two investors may enter a weather derivative, where one ...
- Weather Derivative Valuation - Cambridge University Press
Originally published in 2005, Weather Derivative Valuation covers all the meteorological, statistical, financial and mathematical issues that arise in the pricing ...
- Amazon.com: Weather Derivative Valuation: The Meteorological ...
"This is the first book to cover all the meteorological, statistical, financial, and mathematical issues that rise in pricing and risk management of weather derivatives ...