weather. The fair price of the derivative should be greater than the seller’s indifference price and less than the buyer …This paper follows an incomplete market pricing approach to analyze the evaluation of weather derivatives and the … viability of a weather derivatives market in terms of hedging. A utility indifference method is developed for the specification …

risk can transfer it to financial markets via weather derivatives. We develop a utility-based model for pricing baskets of … weather derivatives under default risk on the issuer side in over-the-counter markets. In our model, agents maximise the …Weather derivatives are contingent claims with payoff based on a pre-specified weather index. Firms exposed to weather …

. The spatial derivative price distribution involves a risk premium. We examine functional principal components of …Due to dependency of energy demand on temperature, weather derivatives enable the effective hedging of temperature … related fluctuations. However, temperature varies in space and time and therefore the contingent weather derivatives also vary …