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Robinhood introduced the launch of U.S. presidential election occasion contracts on Monday, enabling prospects to commerce based mostly on their prediction for the tightly contested race between Vice President Kamala Harris and former President Donald Trump.
Markets will likely be watching the Nov. 5 contest carefully and analysts anticipate volatility throughout asset lessons within the run-up to the outcomes.
The buying and selling platform, widespread amongst retail merchants, stated the presidential election occasion contracts will begin rolling out to a restricted variety of customers on Monday and that prospects buying and selling in them have to be residents of the US.
Occasion derivatives buying and selling includes shopping for and promoting contracts that permit merchants to take a position on the end result of particular occasions corresponding to elections, financial information releases, or coverage selections, with out proudly owning the underlying belongings associated to these occasions.
Some of these derivatives, that are comparatively new and customarily thought of high-risk in comparison with conventional monetary devices, have gained traction in recent times.
PredictIt, a real-money prediction market platform the place customers should buy and promote shares on the outcomes of future occasions, has additionally gained vital recognition this yr within the lead-up to the election.
Robinhood launched futures and index choices buying and selling options to its cellular app, for a payment, earlier this month, marking a shift from its conventional commission-free buying and selling mannequin.
The corporate, which turned synonymous with mom-and-pop traders in 2021, is now aiming to evolve right into a complete monetary companies supplier and compete with established brokerages catering to institutional purchasers.
It dedicated earlier this yr to increasing margins and prioritizing “worthwhile development” in 2024. Investor enthusiasm for brand new merchandise and the concentrate on earnings have fueled a year-to-date inventory enhance of greater than 100%.
