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What is weather futures? Please explain, thank you.
The trading principle of weather futures is essentially the same as other futures. At the beginning of each month, the competent department of futures market will set an initial value, such as 40 degrees (Fahrenheit), for the number of cooling days or heating days according to the temperature situation in the past 10 month. In order to make the market operate, the designated "market maker" will then shout out "bid" and "asking price", the former is slightly lower than the initial value, and the latter is slightly higher than the initial value, which is the extent to which investors can buy or sell.