Weather derivatives supply a device for climate threat administration, and the markets for those unique monetary items are steadily rising in dimension and value. This distinct monograph provides a unified method of the modeling and research of such climate derivatives, together with monetary contracts on temperature, wind and rain. according to a deep statistical research of climate components, refined stochastic procedures are brought modeling the time and area dynamics. employing principles from the fashionable concept of mathematical finance, climate derivatives are priced, and questions of hedging analyzed. The treatise comprises an in-depth research of commonplace climate contracts traded on the Chicago Mercantile alternate (CME), together with so-called CDD and HDD futures. The statistical research of climate variables is predicated on a wide information set from Lithuania.

The monograph contains the study performed via the authors during the last decade on climate markets. Their paintings has received substantial consciousness, and has been utilized in lots of contexts.

Contents:

• Financial Markets for Weather
• Statistics of Weather:
  • Data Description and Exploratory Analysis
  • Spatial-Temporal Modelling
• Weather Derivatives:
  • Continuous-Time versions for Temperature and Wind Speed
  • Pricing of ahead Contracts on Temperature and Wind Speed
  • Extensions of Temperature and Wind velocity Models
  • Options on Temperature and Wind
  • Precipitation Derivatives
  • Utility-Based methods to Pricing climate Derivatives

Readership: Researchers in mathematical/quantitative finance, environmental/energy economics.