weather derivative
- A financial instrument that derives its value from a particular weather condition, providing coverage against potential loss due to fluctuating weather patterns
- The gas company used a weather derivative to protect its business against an unusually mild winter.
- Farmers can use weather derivatives to safeguard their crops against excessively rainy or dry seasons.
- An energy provider may purchase a weather derivative to manage the risk of sudden changes in electricity demand due to weather variations.
Provide Feedback
