Cao, Xiaofeng; Okhrin, Ostap; Odening, Martin; Ritter, … - 2014
Forecasting temperature in time and space is an important precondition for both the design of weather derivatives and … the assessment of the hedging effectiveness of index based weather insurance. In this article, we show how this task can …, we show how geographic basis risk inherent to weather derivatives can be mitigated by regional diversification. …