The Chicago Mercantile Weather Derivatives

Locksmith

Locksmith

Farm Hand
Messages
101
Just in case you feel like getting inventive with your money, The CME is the only market where you can "Trade the weather".

"In the late 1990s, people began to realize if they quantified and indexed weather in terms of monthly or seasonal average temperatures and attached a dollar amount to each index value, they could, in a sense, "package" and trade weather. In fact, this sort of trading would be comparable to trading the varying values of stock indices, currencies, interest rates, and agricultural commodities. The concept of weather as a tradeable commodity, therefore, began to take shape."

Source


This is something that sounds interesting enough to learn.

Who's with me?
 
Jack L

Jack L

Farm Hand
Messages
67
interesting enough to learn.

Who's with me?

I'm with you on that part. That is wild.

This sounds similar to "covering the spread" in sports betting. I wonder if that was the impetus.
 
Urban Homestead

Urban Homestead

Bean Stalker
Messages
208
How wild! I had no idea. I can't say that I'll join in. I'm fairly risk averse. Though I still kick myself for not investing in Bitcoin when it was super cheap.
 
 
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