Cboe enters prediction markets with Mini-S&P 500 contracts
Cboe Global Markets is moving into prediction markets, launching contracts tied to the Mini-S&P 500 Index as retail demand for short-term, outcome-based trading accelerates. The move gives the owner of the VIX a new way to build on the rapid growth of zero-day options, one of the most active corners of U.S. derivatives markets.
Highlights
- Cboe launched its first prediction-market product.
- The contracts are tied to the Mini-S&P 500 Index.
- Interactive Brokers provides access to Cboe’s new contracts.
- Prediction-market volumes have risen sharply since last year.
A regulated entry into prediction trading
According to CNBC, Cboe’s first prediction-market product is built around binary option contracts on the Mini-S&P 500 Index. The contracts are available through Interactive Brokers and are expected to roll out on Charles Schwab over the coming months, with more retail brokerage platforms to follow.
The structure allows traders to express a view on a defined market outcome, rather than buying a traditional stock or index option. Cboe has previously described its framework as an attempt to move beyond simple “yes or no” contracts by adding a middle payout zone, giving traders a partial payout if they are directionally correct but miss the exact outcome.
The company is entering a market that has grown quickly. Trading volume on Kalshi and Polymarket rose to about $24 billion in April from less than $5 billion in September, according to Pew Research Center data cited in the report.
Building on the 0DTE boom
Cboe is trying to connect prediction markets with demand it already sees in very short-dated options. JJ Kinahan, Cboe’s head of retail expansion and alternative investment products, said customers continue to show interest in shorter-dated, outcome-based trading.
That demand has helped make zero-day-to-expiry options a major part of U.S. index trading. Prediction markets offer a simpler format for some retail traders: a defined event, a limited payout structure and a clear settlement outcome.
Why this matters for market structure
Cboe’s entry matters because it brings prediction markets closer to regulated exchange infrastructure. The company is not offering broad political or sports wagers with this product. It is starting with a financial index, where it already has deep experience through SPX and VIX-related markets.
That could make prediction-style contracts more acceptable to mainstream brokers and retail investors. It also raises a bigger question for Wall Street: whether outcome-based products become a new entry point into options trading. If they do, Cboe could turn a retail trend into another regulated derivatives business.
In addition, we wrote that CFTC eases reporting requirements for prediction markets.
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