Weather#373tier 2experimental liveNew

`wildfire smoke airline short`

cadence: Dailydata: mediumshort only

2024

Cohen, M.A. et al (2024). "Climate Risk and Airline Operations." J. Transportation Research Part D. Combined with Currie-Schmeider 2009.

Citation only — paper link pending.

What it checks

When major wildfires (including in Canada) blanket US airline hubs in smoke and degrade air quality, airlines face delays, diversions, and lost revenue. Short the US airline basket for 1-4 weeks after the worst smoke events.

Mechanism

Major wildfire smoke-plume events degrade visibility and air quality at major US airline hubs (SFO, LAX, SEA, DEN, BOS, JFK — e.g. the 2023 Canadian-fire smoke event blanketing the Northeast), triggering ground stops, diversions, and lower load factors. Major US airlines (LUV, DAL, UAL, AAL, ALK) take revenue and on-time-performance hits over the 5-15 day post-event window.

No production champion data for this family yet. Stats appear once the discovery pipeline promotes at least one strategy with this family tag, or once a multi-family blend that includes it earns a champion slot.

Signal rule

VIIRS 7d rolling sum of hotspots across N. America bounding-box (24-60 lat / -140 to -55 lon, includes Canadian provinces) top-85th/95th-pctl of trailing 252d (T+1) -> SHORT airline ticker for 5/10/20 trading days.

Data dependencies

daily_prices
Adjusted-close OHLCV for every US-listed ticker; primary price feed.
viirs_fires
Worker data table — see services/worker schema.

Expected edge

Paper alpha: -1 to -3% over 5-20d
Paper window: T+1 to T+20d

-1 to -3% over 5-20d on airline basket during top-decile smoke events.

Example tickers where this is likely to fire

LUV DAL UAL AAL ALK JBLU

Illustrative only — the signal fires based on the live data, not a fixed list.

Related families

viirs hotspot density utility shortWeather

Sustained high VIIRS satellite hotspot counts within California / PG&E service territory bounding-box correlate with elevated wildfire-liability risk for the utility (PG&E ~$30B aggregate liability from 2017-2018 fires) and lift reinsurance demand on the offsetting side. Uses the VIIRS feed (591MB table, 5y depth, 375m resolution) for a faster-moving signal than NIFC weekly summaries.

wildfire acreage utility shortWeather

CA wildfires >50k acres drive negative drift in CA IOUs (PCG/EIX/SRE) via PSPS + inverse-condemnation liability.

snowfall retail shortWeather

6+ snowfall in top retail metros suppresses foot traffic 1-2 weeks; apparel/dept-store retailers miss the following week's SSS prints.