CME and " Weather " Futures Markets ?

M

md2324

How do you & or would you ever want to trade the " Weather " ...... Frost, Hurricane, RainFall, SnowFall, Temperature?

I just now saw this on the CME website, and am curious as to how you would trade these ?

Thanks
 
md2324 said:
How do you & or would you ever want to trade the " Weather " ...... Frost, Hurricane, RainFall, SnowFall, Temperature?

I just now saw this on the CME website, and am curious as to how you would trade these ?

Thanks
More...

I am sure insurance companies do for hedging purposes and there is also a fund out of Bermuda ( Nephila Capital) that specializes in this. I am guessing there are others...
 
Yep, I'm with @dealmaker. My guess is mostly insurance companies, and perhaps farmers, real estate firms, home builders and others can use these futures to hedge their exposure. There are a lot of folks with proprietary weather tracking / prediction models who may take the other side as market markets.
 
All the answers so far are to the question "who trades these". Anyone have an answer on the first part of the question, "how do you trade these"? I don't see them available at my broker (optionsxpress), and a quick scan of some other retail brokers don't show them as available trading products either. How would your typical farmer go about availing themselves of these?
 
Speak with your broker. I suspect they're on a CME channel few brokers bother listening to on their gateway. I can pull them on my TT screen by typing in "cooling". http://www.cmegroup.com/trading/weather/

cooling.png
 
Thank you for everyone's Replies , That makes a lot of since now


So are there actual way that we as Traders could Go Long or Short the various Weather conditions ?

Trade Futures on them ?
Trade Options on them ?
 
Sig said:
All the answers so far are to the question "who trades these". Anyone have an answer on the first part of the question, "how do you trade these"? I don't see them available at my broker (optionsxpress), and a quick scan of some other retail brokers don't show them as available trading products either. How would your typical farmer go about availing themselves of these?
More...

Sig these are primarily OTC products that get posted on the exchange. Heating and cooling days are crucial to the natural gas and power markets.
 
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