SYSTEM, METHOD AND MEDIA FOR TRADING OF EVENT-LINKED DERIVATIVE INSTRUMENTS

摘要

A derivative financial instrument is created which facilitates the reallocation of a risk caused by the occurrence of an event or condition. For example, a system, method, and media are directed to allocating risks of water shortages. A computer-readable financial instrument is established based on a water availability score that is calculated from one or more types of hydrological factors, a settlement value function, and a settlement date. The financial instrument is configured to transfer, on the settlement date, a cash or physical commodity amount to a buyer or seller of the instrument as determined by the contract specification if the score is zero, or a positive or negative number or within a specified range of positive or negative values.