Interactive Brokers has announced the launch of Forecast Contracts on upcoming US election results through the ForecastEx exchange.
By introducing election-focused contracts, IBKR allows investors to better manage portfolio risks tied to political uncertainty, while also expressing their views on key global events, which means that investors can protect their portfolios from election-driven market movements or capitalize on their political insights.
“A direct line to market sentiment on elections”
Thomas Peterffy, Founder and Chairman of Interactive Brokers, said: “Forecast Contracts allow investors to act on the most crucial issues shaping our future. These contracts give traders a direct line to market sentiment on elections, helping them manage risk or express views on political events.”
IBKR announced the following Forecast Contracts on US election results will be available at launch:
- Will Kamala Harris win the US Presidential Election in 2024?
- Will Donald Trump win the US Presidential Election in 2024?
- Will the Democratic Party win a majority in the United States House of Representatives in the 2024 general election?
- Will the Democratic Party win a majority in the United States Senate during the 2024 general election?
- Will Kari Lake (R) win Arizona’s United States Senate election in 2024?
- Will Mike Rogers (R) win Michigan’s United States Senate election in 2024?
- Will Tim Sheehy (R) win Montana’s United States Senate election in 2024?
- Will Sam Brown (R) win Nevada’s United States Senate election in 2024?
- Will Bernie Moreno (R) win Ohio’s United States Senate election in 2024?
- Will Dave McCormick (R) win Pennsylvania’s United States Senate election in 2024?
- Will Eric Hovde (R) win Wisconsin’s United States Senate election in 2024?
Contract prices range from $0.02 to $0.99
These contracts provide investors with a straightforward way to take a position on significant political events. For example, if an investor believes the U.S. Senate will be under Democratic control in 2025, they can purchase a “yes” contract. Conversely, if they think the event will not occur, they can buy a “no” contract. Contract prices range from $0.02 to $0.99, reflecting the market’s changing view of each outcome’s likelihood. For instance, a price of $0.35 indicates a 35% probability.
Forecast Contracts offer several benefits. They allow investors to hedge against uncertainty, protecting their portfolios from election-related market volatility. They also provide an opportunity to profit from insights, turning political knowledge into a financial advantage. Investors can access these contracts easily through IBKR ForecastTrader using an existing Interactive Brokers login. Additionally, there is an incentive coupon earned monthly, based on the daily closing value of a position, currently offering 4.33% APY.
These contracts settle at a fixed value based on the outcome of the event — $1 for a correct prediction and $0 for an incorrect one. This provides a simple and transparent way for investors to engage with political and economic events. Currently, Forecast Contracts on U.S. election results are available only to eligible U.S. residents.
Interactive Brokers aims to expand ForecastEx globally, covering a broader range of election events and other major issues. This strategic initiative enhances Interactive Brokers’ position as a leader in innovative financial products, giving investors a new way to navigate politically uncertain markets. ForecastEx LLC, a wholly-owned subsidiary of Interactive Brokers, is regulated by the CFTC.
For more information, visit IBKR ForecastTrader to start trading political predictions and protect portfolios from market fluctuations driven by election outcomes.
