Weathering the subprime meltdown

While conventional markets have been battered by the subprime crisis, weather market players have enjoyed high returns. Investing in weather derivatives provides insulation from volatile, chaos-prone and unpredictable human decision-making processes, writes Pablo Triana of Madrid's Instituto de Empresa Business School

Amid all the turmoil experienced by conventional financial markets lately, one underlying asset not normally associated with stability has put in a surprisingly consistent performance – weather.

Elsewhere the last four months have involved numerous shocks: a historic spike in equity-implied volatility; an unplanned sharp interest rate cut in the US; a bank run in the UK; and the the euro surpassing