Election markets are about to drop. Be one of the first to trade on the first of its fully-regulated kind. But before they do, here’s a briefer on the market potential and trading opportunities.
Profit from your personal political risk
Elections are for the people, and election markets should be as well. They’re almost here. On October 28th*, you can trade on our Congressional Control market. Elections result in:
1. The appointment of different people to regulatory positions.
2. The enactment of different regulatory policies.
3. The passing of different bills.
Bills directly impact your everyday life, and they are controlled by Congressional control itself. With a Congressional Control contract, you can predict which party is in control of Congress after midterms. This control, based on the party, will determine the result of bills in the House. For example, current contentious ones include:
The US-China competition bill
A Congressional stock trading ban
Daylight savings time be made permanent
The gas tax be suspended
The American Choice and Innovation Online Act
Corporate tax rates
Income taxes rises
Students for Fair Admissions v. Harvard (affirmative action)
As well as a range of other factors that impact you personally, your portfolio and the society you live in at large. All of the above directly impact pricing, investment outlooks, and many other economic decisions.
In other words, an election outcome shapes the landscape businesses operate in. Thus, your portfolio’s performance is directly tied to it. And for the first time in US history, you can trade on it on a fully-regulated exchange.
The debrief
It’s 2016. The beginning of summer, to be exact, long before elections began dominating the news. But the United Kingdom’s were. And, more specifically, Brexit.
You may have not seen it coming, but the British certainly didn’t. In a shock 51-49 vote, the British spent four years and three prime ministers trying to reach an outcome for the contentious vote. This outcome impacted both domestic and international channels. From transportation, culture, finance, households, and even sports, the UK’s vote to leave the European Union threw risks into every British citizen’s life. They voted, and now they couldn’t do much else about it.
But politicians weren’t the only ones who could. Banks also have the ability to do something about elections: profit from them. Before a vote, clients will ask their advisors to help them hedge against risks from its outcome. Banks then devise complex derivatives products to effectively hedge and/or profit from the vote.
Wouldn’t it be simpler if the contracts simply paid out in the event of a “leave” vote?
You can read Kalshi's letter to the CFTC on the merits of election markets here.
*Pending regulatory approval