Market Participants
A wide range of capital providers make markets in weather risk. To date the weather risk management trading market is primarily made up of dedicated weather trading operations, such as Nephila Capital Ltd, Galileo Weather Risk Management Advisors LCC, Swiss Re, RenRe, and Coriolis Capital, who execute trade orders in weather or weather-contingent commodity trades, the trading desks of financial institutions and utilities, such as Susquahanna Energy and Aquila who hedge their own risk as well as speculative trades for a merchant portfolio, professional commodity traders, such as RJO and hedge and private equity funds such as Tudor Capital. Transactions can be effected over-the-counter (OTC) or on commodity exchanges such as The Chicago Mercantile Exchange (CME). Still other operations, such as Storm Exchange, Inc and WeatherBill, provide corporate and municipal clients with the necessary financial context to gauge the impact of the weather on profit and loss before executing trades either OTC or through the CME.
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