ℹ️Formula for Payout Structure (HDD Based)

F = α * max(HDDs - K, 0) F = Financial Value associated with a weather derivative contract

α = Co-efficient that scales payout for each unit of HDD

HDDs = Denotes the cumulative Heating Degree Days for a specified time period

K = Threshold level that triggers the payout

Reference articles link:

• Pricing Weather Derivatives :- https://www.hindawi.com/journals/amete/2015/837293/

• Research Article on Blockchain based platform for Trading Weather Derivatives by Research Square :- https://assets.researchsquare.com/files/rs-1891762/v1_covered.pdf?c=1659107422