Even in our advanced, technology-based society, we still live largely at the mercy of the weather. It influences our daily lives and choices, and has an enormous impact on corporate revenues and earnings. Until recently, there were very few financial tools offering companies' protection against weather-related risks. However, the inception of the weather derivative - by making weather a tradeable commodity - has changed all this. Here we look at how the weather derivative was created, how it differs from insurance and how it works as a financial instrument.
Read more: Introduction To Weather Derivatives | Investopedia http://www.investopedia.com/articles/optioninvestor/05/052505.asp#ixzz3z7o1Fdmq
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