I recently came across an interesting finding that accurately depicts true American entrepreneurial spirit. It turns out that there is a bright side to all the snow blizzards this year, for those aware anyway. Since Chicago has been a crazy unpredictable ground for heaps of snowfall for the last couple years, a creative trader in Chicago decided to start hedging snow futures. Crazy? Not at all.
Using snow derivatives (aka method to the madness), Chicago Mercantile Exchange trades futures that pay or collect depending on the snow fall compared to Chicago's average of 37 inches a season. So, who's interested?
People with a lot of money OR businesses that depend on the weather for their business operations i.e. airlines and like businesses. Depending on what contract they decide to play with, they use these funds as an insurance for their downtime during bad weather.
Simply genius. Something as simple as snowfall can create a business for someone truly business minded. I guess an observation or idea is just a method away from a dream. Cheers to entrepreneurial competency!
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