Cboe Global Markets announced the launch of the first products in its new prediction markets suite, Cboe Predicts. The initial offering includes binary option contracts based on the Mini-S&P 500 Index (XSP), which are listed under the symbols XSPBW and XSPBX.
The contracts are now available through Interactive Brokers and are expected to become available at Charles Schwab in the coming months. Cboe also expects additional retail brokerage platforms to provide access over time.
Cboe Predicts marks the latest expansion of Cboe’s S&P 500 Index product suite. The XSP product enables customers to trade based on the performance of the S&P 500 Index while being scaled to one-tenth the size of SPX, making it a smaller and more retail-friendly alternative.
Through these binary options, traders can express a view on where XSP may close by taking a “yes” or “no” position. A “yes” position pays $100 if the index settles at or above a specified level and $0 otherwise. A “no” position pays $100 if the index settles below that level and $0 otherwise.
Cboe said the launch follows strong demand for shorter-dated and outcome-based trading products, especially after the growth of SPX 0DTE options. The company said Cboe Predicts is designed to offer simple yes-or-no payout event contracts while also supporting users with educational resources intended to promote more confident and responsible participation.
In a future release, Cboe also plans to enable trading of XSP vertical spreads through its proprietary and patent-pending Quoted Spread Book framework. The framework is designed to package widely used options strategies into a simpler format, helping newer traders who are already familiar with yes-or-no outcomes build familiarity with more advanced defined-risk options strategies.
The products are securities-based and centrally cleared through the Options Clearing Corporation. Cboe said the intermediated model, which provides access through retail brokers, is designed to support customer education, market access, oversight, risk management, transparency, and surveillance.
Cboe has also introduced educational resources for the product suite, including a new prediction markets resource hub and courses through The Options Institute. These courses are designed to guide learners from market basics and decision-making through Cboe’s yes-or-no contracts and into core options concepts.
KEY QUOTES:
“Following the success of SPX 0DTE options, we have seen continued customer demand for shorter-dated, outcome-based trading, creating a natural extension for Cboe to introduce XSP binary options. Cboe’s S&P 500 options suite has long provided traders with flexibility to define their outcomes through traditional options strategies. With Cboe Predicts, we are expanding that choice by offering simple ‘yes-or-no’ payout event contracts, supported by dedicated educational resources designed to help customers participate more confidently and responsibly.”
JJ Kinahan, Head of Retail Expansion and Alternative Investment Products at Cboe
“OCC stands ready to bring the same clearing infrastructure and risk management discipline that underpins all of the products we clear to the new binary options. Our commitment to operational excellence and financial integrity ensures that participants can engage with confidence, knowing every transaction is supported by sound, well-established clearing and settlement services.”
Mike Hansen, Chief Clearing and Settlement Services Officer at OCC
“Investors increasingly seek products that allow them to express a specific view on future events and market outcomes. Cboe’s binary options and Mini-S&P 500 Index contracts provide another way to do that, and we are pleased to make them available to Interactive Brokers clients.”
Milan Galik, Chief Executive Officer of Interactive Brokers
“We support approaches that bring transparency, defined risk, and investor education to financial-related prediction markets. We plan to offer clients access to these binary options contracts in the coming months, building on our existing platform and demand from active traders.”
James Kostulias, Head of Trading Services at Charles Schwab
“For more than 50 years, Cboe has built and operated some of the world’s most established and trusted markets. We look forward to bringing our experience, trusted market infrastructure and the deep liquidity of the SPX options ecosystem to prediction markets. Our goal is to help set a higher standard for market integrity, product design and investor protection by offering access through a regulated securities exchange and central clearing through OCC.”
Rob Hocking, Global Head of Derivatives at Cboe
