Weather is the single most important factor in influencing price volatility,
volume fluctuations and revenues in the energy industry, as well as other
industries globally. Weather risk management is now expected by investors and
industry professionals to manage potential exposure to price and volume
fluctuations. This workshop provides a comprehensive overview of weather risk
management products, particularly focusing on weather derivatives. After
completing this course delegates will be able to qualify and quantify weather
risk in their businesses and determine the specific weather derivative tools
necessary to protect revenues from Mother Nature.
Who Should Attend
This one-day workshop is perfect for those who are already familiar with basic
hedging strategies with futures and options but require a volume focused
approach to risk management. Delegates include everyone from trade staff to
senior management from any industry with an exposure to earnings volatility
through adverse weather conditions.
Prerequisites:
Delegates entering this course should already
have successfully completed
Fundamentals of Energy Futures,
Options I - Fundamentals of Energy Options
and Energy Risk Management
or have equivalent experience.
Pre-classroom Study
As part of our blended learning package,
this workshop has a specific web-based course which is recommended as
pre-classroom study. Upon registering for the workshop delegates will receive
details of how to access the web-based course. Access to the web-based course
is included in the price of the classroom course.
To optimize your classroom experience, it is recommended you take the
appropriate online study as close to the classroom date as possible.
The recommended pre-classroom study for this workshop is:
A Guided Tour of Commodity Derivatives
What You Will Learn
- How weather derivatives differ from weather insurance and other derivatives
- Structuring a weather derivative
- Heating and cooling degree day calculations
- Anatomy of a weather derivative contract
- The market players and how risk differs with types of hedgers
- Quantification and qualification of risk
- Where to find relevant weather data and how to use it effectively
- Overview of global market developments
- Weather risk management tools:
- Defined Events
- Seasonal degree day swaps
- Floors, caps and collars
- Embedded agreements
- Overview of pricing methodology
- Futures contracts developments
- Weather derivative regulation and accounting requirements globally