Robinhood has announced the launch of event contracts for the upcoming US presidential election, allowing users to speculate on the outcome of the race between Vice President Kamala Harris and former President Donald Trump. This new offering targets retail investors interested in high-risk, speculative trading and comes as recent polls show a close contest, with Harris slightly leading within the margin of error. Robinhood’s stock jumped 4% following the announcement, as the company begins rolling out these contracts to a select number of US citizens.
Event derivatives, such as those offered by Robinhood, allow traders to bet on specific outcomes, including political events, economic trends, and policy shifts. Although high-risk, these derivatives have grown in popularity, and Robinhood’s move into this space mirrors its recent additions of futures and index options trading on its mobile app.
Competing platforms like PredictIt, Interactive Brokers Group (IBKR), and Kalshi are also offering contracts for betting on the election outcome, scheduled for November 5. Robinhood’s latest offerings signal a shift in its strategy as it broadens its services, aiming to capture a share of the institutional client market.
The decision follows a recent judicial ruling allowing Americans to engage in event derivatives betting, a decision upheld by an appeals court in October, overturning the US Commodity Futures Trading Commission’s (CFTC) previous attempt to block such trades. This
