Hurricane Contracts Now Trading on HedgeStreet; First Regulated Online Futures Market to Address Economic Impact of Destructive Storms.SAN MATEO San Mateo (săn mətā`ō), city (1990 pop. 85,486), San Mateo co., W Calif., on San Francisco Bay; inc. 1894. It is a commercial and retail center with some high-technology manufacturing. San Mateo, Spanish for St. , Calif. -- HedgeStreet, the nation's first government-regulated online retail market for trading binary and If two conditions are combined by and, they must both be true for the compound condition to be true as well. Likewise, two bits may be combined with and: x y x AND y 0 0 0 0 1 0 1 0 0 1 1 1 I.e. futures contracts, today announced the launch of Hurricane contracts, offering traders the ability to hedge or speculate on the economic impact of hurricane and tropical storm damage. Insurance Services Office Insurance Services Office, Inc. (ISO) is a provider of data, underwriting, risk management and legal/regulatory services to property-casualty insurers and other clients. Headquartered in Jersey City, New Jersey, the organization serves clients with offices throughout the United , Inc., (IS0) (http://www.iso.com/products/2800/prod2803.html) will supply data on insurance claim estimates that form the basis for HedgeStreet's hurricane contracts. ISO estimates that insured property losses caused by Hurricane Katrina in 2005 topped $40 billion and had profound effects on energy prices and the U.S. economy. "The destructive power of hurricanes is an unfortunate risk of living in many heavily populated coastal areas of our country. HedgeStreet is using ISO data to offer a low-cost means of hedging risk from hurricane and tropical storm damage. Our intention is to build this market into a valuable resource for mitigating storm damage risk," said Bill McIntosh, Vice President of Marketing for HedgeStreet. "ISO sees the development of tropical storm derivatives as another tool insurers can use to mitigate loss in an era of escalating catastrophe exposure," said Gary Kerney, assistant vice president of ISO's Property Claim Services unit. "These products enable the risk transfer of insurable losses within the insurance industry and will help link reinsurance The contract made between an insurance company and a third party to protect the insurance company from losses. The contract provides for the third party to pay for the loss sustained by the insurance company when the company makes a payment on the original contract. markets with traditional capital markets. We are delighted to be working with HedgeStreet in providing the underlying insured damage loss numbers for these Hurricane contracts." HedgeStreet is introducing two classes of $100 binary contracts: --HURRICANE SEASON: The first contract's underlying value is based on the total estimated losses from hurricanes and tropical storms that caused at least $25 million in insured damages during the 2006 hurricane season, as reported by ISO. The last trading day Last Trading Day The final day that a futures or options contract may trade or be closed out before delivery of the underlying asset must occur. Notes: If the buying and selling parties do not arrange an alternate agreement, the physical commodity must be delivered from for these contracts will coincide with the last day of the hurricane season on November 30, 2006. --NAMED STORMS: The second underlying value is based on the preliminary damage estimates caused by a hurricane or tropical storm, as calculated and reported by ISO. These contracts will be listed on HedgeStreet during hurricane season once a tropical storm has developed over the Atlantic Ocean as determined by the National Hurricane Center The U.S. National Hurricane Center, located at Florida International University in Miami, Florida, is the division of National Weather Service's Tropical Prediction Center responsible for tracking and predicting the likely behavior of tropical depressions, tropical storms and . Hurricane contracts for Tropical Storm Debby, which originated off the west coast of Africa, were listed as of last night, and made available for trading this morning at 9:00 a.m. EDT EDT abbr. Eastern Daylight Time EDT Eastern Daylight Time EDT n abbr (US) (= Eastern Daylight Time) → hora de verano de Nueva York EDT . The 2005 Atlantic hurricane season was a record-shattering year that witnessed the most named storms (28), the most hurricanes (15), the most category 5 hurricanes (5), and the most major hurricanes to hit the U.S. (4)(a). A hurricane is tropical cyclone with maximum sustained wind speeds in excess of 74 mph. These storms are classified according to the Saffir-Simpson Hurricane Scale The Saffir-Simpson Hurricane Scale is a scale classifying most Western Hemisphere tropical cyclones that exceed the intensities of "tropical depressions" and "tropical storms", and thereby become hurricanes. on a rating of 1 to 5, based upon wind speed. Category 5 storms are the most destructive. Such increasingly violent activity is forecasted to continue over the next five years due to changes in climate patterns. Today at 1pm EDT HedgeStreet and ISO executives will hold a conference call to discuss and take media questions on the new hurricane contracts, their structure and their many uses. The call can be accessed at (866) 244-4530. HedgeStreet offers new members 30 days free trading, and real-time funding allows investors to begin trading immediately upon opening an account. About HedgeStreet HedgeStreet Inc. is the only U.S. based person-to-person market that lets online investors trade innovative financial instruments based on economic events and price movements. HedgeStreet offers its members online futures trading, online currency trading and online commodity trading. A designated contract market (DCM DCM abbr. Distinguished Conduct Medal ) and a registered derivatives clearing organization (DCO DCO Demande Chimique En Oxygène (French) DCO Digitally Controlled Oscillator DCO District Coordination Officer (Pakistan) DCO Defence Community Organisation (Australia) ), HedgeStreet is subject to regulatory oversight by the Commodity Futures Trading Commission The Commodity Futures Trading Commission (CFTC), the federal regulatory agency for futures trading, was established by the Commodity Futures Trading Commission Act of 1974 (88 Stat. 1389; 7 U.S.C.A. 4a), approved October 23, 1974. (CFTC CFTC See: Commodity Futures Trading Commission CFTC See Commodity Futures Trading Commission (CFTC). ). For more information, visit www.hedgestreet.com. About ISO Founded in 1971, the source agency ISO is the preeminent provider of actuarial, statistical, and underwriting information for the property/casualty insurance and risk management industries and an internationally recognized authority on insured property losses from catastrophes in the United States. For more information, visit www.iso.com. (a)www.noaanews.noaa.gov/stories2005/s2540.htm. |
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