Weather derivatives to buck trading downturn

Weather derivatives have a promising future, despite troubles in the energy merchant sector, according to a report by New York-based energy consultancy RJ Rudden Associates.

The study, based on interviews with 20 marketers, traders and utility chief financial officers, found the trend towards warmer-than-normal weather has increased awareness of volumetric risk, making many regulated electricity and natural gas distribution companies take a fresh look at an array of risk management options.

RJ

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