Charles Schwab is collaborating with Cboe Global Markets to introduce a novel options contract enabling customers to place yes-or-no bets on the S&P 500’s performance, representing the firm’s initial foray into prediction markets, according to a Wall Street Journal report.
The service is anticipated to become available to Schwab clients in the coming months, as cited by individuals familiar with the initiative.
Unlike conventional prediction market platforms such as Polymarket and Kalshi, which generally provide futures contracts linked to event outcomes, Schwab’s offering will operate as a binary option, paying a fixed cash sum or expiring without value contingent on the S&P 500 closing above or below a predetermined price point.
Schwab and Cboe are also exploring a comparable product tied to the “Plus Zone” feature, potentially allowing traders to receive partial payouts when their predictions are near the actual outcome, even if the index does not precisely reach the target.
