Interactive Brokers Launches Forecast Contracts on Economic and Climate Events
June 26 2024 - 9:00AM
Business Wire
IBKR Offers Commission-Free Trading on
ForecastEx
Interactive Brokers Group (Nasdaq: IBKR), an automated global
electronic broker, is pleased to announce that its wholly-owned
subsidiary, ForecastEx LLC, has received the necessary designations
from the Commodity Futures Trading Commission (CFTC) to operate a
contract market and derivative clearing organization. ForecastEx
starts operations on Monday, July 8, 2024, and Interactive Brokers
clients from eligible countries will have immediate access.
Interactive Brokers is the first Futures Commission Merchant to
join as an exchange member.
“ForecastEx is a prediction market that we have been working on
and experimenting with for nearly 10 years,” said Thomas Peterffy,
Chairman and Founder of Interactive Brokers Group. “Planning for
the future is the ultimate task for any business leader, government
official or individual. For those plans to work according to
expectations, they must fit into unfolding conditions resulting
from all our actions. The more perfect information we have about
the state of the world, the more perfectly we can plan and
coordinate our actions. Markets are the most direct ways of
expressing our unbiased expectations, and market prices tell us the
prevailing consensus. We may adjust our plans based on consensus
forecasts or express our disagreement to earn a profit or hedge our
exposures.”
Contracts listed on ForecastEx are simple and intuitive. For
example, suppose an investor believes an event will occur, such as
an increase in the US Consumer Price Index above a specific value.
In that case, they can buy a "yes" contract. Conversely, if they
think the event will not happen, they can purchase a "no" contract.
Contract purchase prices range from $0.02 and $0.99. The value of
these contracts will continue to fluctuate based on market
participants’ evolving judgment of probabilities, directly
reflecting the collective market view of the likelihood of the
event. Upon the event's resolution (e.g., the moment the US Bureau
of Labor Statistics announces the CPI), the contract settles at a
predefined value — $1 for a correct contract and $0 for the
incorrect one.
ForecastEx contracts are ideal for establishing the consensus
view on controversial issues and hedging economic exposure.
ForecastEx contracts for the following indicators will be
immediately available:
Economic
- US Fed Funds Target Rate
- US Consumer Sentiment
- US Housing Starts
- US Retail Sales
- US Building Permits
- US Consumer Price Index
- US Payroll Employment
- US Unemployment Rate
- US Corporate Profits
- US Initial Jobless Claims
- US National Debt
- US Real GDP
Climate
- Global Temperature
- US Temperature
- Atmospheric Carbon Dioxide
ForecastEx contracts have weekly, monthly, quarterly and annual
durations. Interactive Brokers will pay interest at 0.5% under the
prevailing Fed Funds rate on the closing market value of positions.
Income interest accrues daily and is paid monthly, currently at a
rate of 4.83% APR.
Eligible clients of Interactive Brokers LLC, Interactive Brokers
Hong Kong Limited, and Interactive Brokers Singapore Pte. Ltd. can
trade ForecastEx contracts on IBKR ForecastTrader. After its
initial launch, ForecastEx will expand internationally and cover
additional local and controversial global issues. Contracts will be
limited only by the availability of credible, impartial arbiters of
event resolutions.
For additional information, please visit:
US - IBKR ForecastTrader (US and countries served by IB LLC)
Hong Kong - IBKR ForecastTrader Singapore - IBKR ForecastTrader
The Best Informed Investors Choose Interactive Brokers
About Interactive Brokers Group, Inc.:
Interactive Brokers Group affiliates provide automated trade
execution and custody of securities, commodities, and foreign
exchange around the clock on over 150 markets in numerous countries
and currencies from a single unified platform to clients worldwide.
We serve individual investors, hedge funds, proprietary trading
groups, financial advisors and introducing brokers. Our four
decades of focus on technology and automation have enabled us to
equip our clients with a uniquely sophisticated platform to manage
their investment portfolios. We strive to provide our clients with
advantageous execution prices and trading, risk and portfolio
management tools, research facilities and investment products, all
at low or no cost, positioning them to achieve superior returns on
investments. Interactive Brokers has consistently earned
recognition as a top broker, garnering multiple awards and
accolades from respected industry sources such as Barron’s,
Investopedia, Stockbrokers.com, and many others.
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version on businesswire.com: https://www.businesswire.com/news/home/20240625254137/en/
For Interactive Brokers Group, Inc. Media: Katherine Ewert,
media@ibkr.com
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