In usual pricing approaches for weather derivatives, forward-looking information such as meteorological weather … forecasts is not considered. Thus, important knowledge used by market participants is ignored in theory. By extending a standard … model for the daily temperature, this paper allows the incorporation of meteorological forecasts in the framework of weather …

interesting for investors and issuers of weather contracts to take advantages of geographic diversification, hedging effects and …Forecasting based pricing of Weather Derivatives (WDs) is a new approach in valuation of contingent claims on … nontradable underlyings. Standard techniques are based on historical weather data. Forward-looking information such as …

innovation consists in an incorporation of omnipresent weather forecasts via numerous tailor-made enlargements of the underlying … optimal positions in a temperature futures portfolio under future weather information to hedge against both temporal and …