Living on Earth’s Jennifer Chu reports on a new weather index that may serve as nature’s stock exchange.
ROSS: Just ahead, how raising a barn can raise consciousness about light pollution. First, this Environmental Business Note from Jennifer Chu.
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CHU: Weather can be a fickle force. And businesses can gain or lose millions on nature's whim. But, now there's a way you may be able to profit from a rainy day. Zipspeed is the name of a weather risk management company based in Atlanta, Georgia. And, it's set to launch the world's first financially traded weather index, or nature's version of the stock exchange.
Companies will be able to hedge their bets against a weather index called NORDIX. NORDIX is based on two daily measures: temperature and precipitation. Weather patterns for the past 30 years determine the averages. And companies can place their money on whether the temperature or precipitation will be above or below normal for a given day. For example, if a theme park is anticipating a rainy weekend, it can put money on the weather index for above-normal precipitation. If the skies pour, the park can take its winnings to the bank, or stay in the game to collect on another rainy day.
Zipspeed representatives say industries can start betting on the NORDIX in a few months. That's this week's Business Note. I'm Jennifer Chu.
ROSS: And you're listening to Living on Earth.
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