HDD

Heating degree days (HDD). The maximum of zero and the amount by which the daily average temperature is less than 658 Fahrenheit. The average temperature is the average of the highest and lowest temperatures (midnight to midnight). The Chicago Mercantile Exchange began trading weather futures and European options on weather futures in September 1999. The contracts are on the cumulative HDD and cooling degree days (CDD) for a month observed at a weather station.