WEATHER DERIVATIVES and PRICING APPROACHES
Öz
The usage of weather derivatives which have a volume exceeding 50 billion USD today, began in 1996 and they were subject to trade first time in 1997. The products that are in question are created in order to protect the individuals and the institutions from climatic risks and seasonal changes which cause commodity and profit loss. These products baselined from weather variables such as heat, frost, storm and hurricane are valued generally by considering the Heating Degree Days and Cooling Degree Days. On the other hand, there has not been any compromise on the pricing of these products until today, although there are lots of approaches that were put forward and so the pricing is still . On the other hand, there has not been any compromise on the pricing of these products until today, although there are lots of approaches that were put forward and so the pricing is still a problem today. In this paper, first of all it is aimed to present the approaches that were put forward in the previous studies as a whole, and then by evaluating these approaches it is concluded that in terms of applicability the most appropriate two approaches are Monte Carlo Simulation and Burn Analysis.
Anahtar Kelimeler
Kaynakça
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