WeatherXchange, a joint venture between the U.K. Met Office and Umbrella Brokers, has hired Dan Tomlinson, head of weather derivatives at ICAP in London, to expand its marketing and consultancy services. Tomlinson, who started last week, said he will report to Cindy Dawes, managing director in Bracknell, U.K.
Dawes said WeatherXchange decided to expand the department by adding Tomlinson because the flood of new entrants into the market, such as investment banks, has increased demand for weather services. The company itself also has more products to offer now. The first new product WeatherXchange plans to roll out is ensemble forecasting for locations across Europe, according to Tomlinson. This will provide probabilities of various weather scenarios for a given location, rather than simply providing a forecast for the most likely weather type at the location. This will help traders price out-of-the-money options.
Both climatic and synoptic data will be offered. He added, "what the customer wants the customer gets." It also plans to price the data so that end-users can afford it to verify derivatives prices. "We are talking Big Mac and large fries," he joked, when describing the pricing levels.
Katleen De Cock, weather derivatives broker at ICAP in London, has been promoted to fill Tomlinson's position. She said she plans to hire a broker to fill her former position.