TFS Energy Hosts Successful Weather Derivatives Dutch Auction
NEW YORK, May 17, 2006 – TFS Energy, LLC, a global leader in interdealer broking, today announced its weather derivatives division completed a successful Dutch auction for an end-user wishing to hedge cool weather exposure in Chicago. The auction was over subscribed in terms of the capacity that was available in the market. A total of $90,000 per degree risk was placed for the period of June 2006 through August 2006. The maximum payout was set at $9 MM. All offers came directly through TFS Energy and had to be received by 1:00 EST, Tuesday, May 9, 2006.
TFS Energy’s weather desks are located in Stamford, London, and Sydney.
Editor Notes on the Dutch Auction
Offers were accepted in minimum tick increments of $10,000 with a corresponding cap of $1 MM.
In the event of multiple successful offers, all offers were filled until the entire tick/cap capacity for the structure was exhausted. All clearing prices received the clearing level for their price.