Modeling Drought Option Contracts

<table class="table-group" id="tab1"><tr><td><table class="table"><tr><td class="thead-hr" colspan="5"><hr/></td></tr><tr class="thead"><td align="left"></td><td align="center">1951–2006</td><td align="center">1967–2006</td><td align="center">1977–2006</td><td align="center">1987–2006</td></tr><tr><td class="thead-hr" colspan="5"><hr/></td></tr><tr><td align="left"> Historical Burn Analysis</td><td align="center">0.1764</td><td align="center">0.1813</td><td align="center">0.1799</td><td align="center">0.1561</td></tr><tr><td align="left">Index Value—Weib. Distribution</td><td align="center">0.1769</td><td align="center">0.1816</td><td align="center">0.1805</td><td align="center">0.1558</td></tr><tr><td align="left">Stochastic Simulation</td><td align="center">0.1666</td><td align="center">0.1782</td><td align="center">0.1739</td><td align="center">0.1502</td></tr><tr class="table-tr"><td colspan="5"><hr class="tbody-hr"/></td></tr></table></td></tr></table>

Option price comparison for months 1–12.

International Scholarly Research Notices

tab1

Table 1

Table 1: Modeling Drought Option Contracts 