About CME Canadian Monthly Weather Cooling Degree Day Futures

CME has added six Canadian cities (Calgary, Edmonton, Montreal, Toronto, Vancouver and Winnipeg) to enable customers the ability to hedge their weather risk in Canada.

How to Measure CDDs

CDD (Cooling Degree Days) values are calculated according to number of degrees an average daily temperature exceeds 65°. For example, an average daily temperature of 80° would generate a daily CDD value of 15 (80-65 = 15). (Note: If the temperature were lower than 65°, the value of the CDD would be zero. Again, remember that in theory there would be no need for air conditioning.)

Monthly HDD (Heating Degree Days) or CDD index values are simply the sum of each daily HDD or CDD value recorded during a given month or season. For example if there were 10 HDD daily values recorded in November 2005 in Chicago, the November 2005 HDD index would be the sum of the 10 daily values. Thus, if the HDD values were 25, 15, 20, 25, 18, 22, 20 19, 21 and 23 the monthly HDD index value would be 208.

The value of a CME Weather futures contract is determined by multiplying the monthly HDD or CDD value by $20. Using the example above, the CME November Weather contract would settle at $4,160 ($20 x 208 = $4,160)

Calgary (WMO 71877)

Edmonton (WMO 71123)

Montreal (WMO 71627)

Toronto (WMO 71624)

Vancouver (WMO 71892)

Winnipeg (WMO 71852)

For information on CME Weather Block trading click here.