The sports event contract business is growing quickly, but it’s not as big or established (at least not yet) as stock trading.
This helps explain why prediction markets are increasingly rolling out products aimed at equity traders, rather than just the sports crowd they might have already won over.
Why would a prediction market dabble in key performance indicators (KPI) when same-game parlays (SGP), or combos, are right there? Well, diversification, differentiation, and a big pile of money all seem like good reasons.
- Prediction markets are adding contracts tied to stock indices, corporate earnings, and industry performance to attract financial traders.
- Kalshi is partnering with S&P Dow Jones Indices, while Robinhood’s Rothera venture has received CFTC approval for a Tesla earnings contract.
- Financial contracts could diversify revenue and offer another growth path as the legality of sports event contracts faces court challenges.
During last week’s NEXTPredict NYC conference, Henry Kerins, CEO of sports-focused market maker Manhattan Athletic Group, said financial derivatives could be a major opportunity for prediction markets.
Kerins pointed to “equity binaries” tied to whether a company meets quarterly earnings targets or its stock price exceeds a specified level on a given date. He also floated the possibility of perpetual futures linked to those contracts.
“The reality just being that the biggest, most well-funded players in traditional finance are extremely adept at pricing these (and) have high need to trade them,” Kerins said. “You could see the absolute sky blowing off the place.”
That probably sounds good to prediction market operators. It also helps explain some exchanges' recent efforts to begin offering contracts that might appeal to stock traders, not just sports ones.
Two volume milestones this week: @Novig surpassed $2B in trading volume since its exchange launched, adding its second billion in less than half the time it took to reach its first as the NFL season ramps up. @Polymarket (US) crypto up/down markets crossed $100M in trailing 7-day trading volume, following their launch announcement earlier this week.
— Aldrin Research (@AldrinResearch) October 1, 2026
Sports-related contracts, including combos, account for roughly 85% of prediction market trading volume. Total notional trading volume for prediction markets over the past month was north of $120 billion, according to Aldrin Research.
For comparison, U.S. sportsbooks accepted more than $166 billion in wagers in 2025, according to the American Gaming Association.
However, Cboe said the average daily notional value of U.S. equities trading in 2025 was $1.1 trillion. And that's daily.
Financial frontier
So something with a little more appeal to stock traders could yield considerable business for prediction markets. And the exchanges were already trying to diversify their businesses, such as by offering contracts tied to cryptocurrency.
Stock-like products (or products that interest stock traders) could be characterized as another effort to diversify. On Tuesday, Kalshi announced it had partnered with S&P Dow Jones Indices “to build the next generation of financial markets.”
The partnership includes plans to create indices composed of Kalshi event contracts, as well as contracts tied to the S&P 500, Dow Jones Industrial Average, and other stock indices.
“That gives investors and traders a new way to gain exposure to these benchmarks through Kalshi markets,” the company said in a press release.
The partnership follows Kalshi’s announcement last week of sector KPI markets, which track corporate metrics across industries.
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Business of predicting business
Those metrics, Kalshi noted, could include credit card spending, point-of-sale data, foot traffic, and app downloads.
“Atomizing equities into specific events and KPIs is one of Kalshi’s best use cases,” Kalshi CEO and cofounder Tarek Mansour said in a press release.
Speaking now at the NEXTPredict conference… DraftKings CEO Jason Robins, who says they are already the clear number three in the PM space. And with their exchange not offering sports contracts in every state. https://t.co/IhtX9aYkOD
— Geoff Zochodne (@GeoffZochodne) October 22, 2026
There are other reasons to diversify the types of contracts on offer. For one thing, the legality of sports event contracts is being contested in court, and there is no guarantee they will be around forever.
While the fate of sports event contracts remains to be seen, swaps tied to stock indices or credit card spending may not be pursued as intently by state gambling regulators.
DraftKings CEO Jason Robins said last week at NEXTPredict NYC that growth in financial prediction markets had pleasantly surprised him. He said the company plans to put more effort into the category, which offers a potential path to customers in all 50 states.
Stock and trade
Other exchanges are putting resources into financial markets as well. Rothera, the joint venture between Robinhood and Susquehanna International Group, announced Wednesday that the CFTC had approved its filing for swaps tied to KPIs for Tesla.
Robinhood Markets has just released financial results for the third quarter of 2026. https://t.co/lygt15zlrh
— Robinhood (@RobinhoodApp) October 27, 2026
Rothera said the approval could pave the way for future contracts tied to metrics such as earnings, sales, and active users.
“The contract is the first of its kind to be approved by the CFTC and will enable a direct way for institutions and intermediaries to manage risks tied to specific measures of company performance,” a press release said.
One more reason for leaning into financial stuff: Not everybody’s doing it. Some exchanges would much rather stick to sports, and so there’s an opportunity to stand out from the crowd by adding something different.
Everybody's doing sports
Robinhood believes in this angle. The company announced Tuesday that revenue tied to event contract trading was $173 million for the three months that ended Sept. 30, six times what it was the year prior.
CEO Vlad Tenev said on the earnings call that Rothera could help Robinhood “own the financial category.”
“Because I think we're less excited about doing what everyone else is doing, which is just all sports all the time,” Tenev said. “I think that's rapidly going to get commoditized and is just, frankly, a little bit less differentiated from my standpoint.”
