Schwab to Offer S&P 500 Prediction Markets via Cboe

Charles Schwab will offer S&P 500 prediction markets through Cboe Global Markets, providing binary contracts that let customers wager on whether the index will finish above or below a specified level at a set date and time. The product will include a Plus Zone feature that pays a reduced multiple when the final index level closes near the target, creating partial payouts for close outcomes.

Cboe will handle contract listing and settlement. The initial offering will focus on the S&P 500, with the firm considering expansion to other indexes and financial benchmarks over time. Schwab has said the product launch is expected in the coming months and will require regulatory and operational approvals before it becomes widely available.

Under the contracts, customers receive a yes-or-no choice tied to a trigger price and a fixed settlement time. The Plus Zone aims to provide a smaller payout when the result is close to the trigger rather than strictly binary win-or-lose outcomes.

Schwab signaled interest earlier this year during its first-quarter earnings call when CEO Rick Wurster stated the firm would likely add prediction markets and drew a distinction from sports, political and entertainment wagering. The brokerage has been expanding its digital trading services; last month it began offering spot trading in Bitcoin and Ethereum to a subset of retail customers after an employee pilot, and leadership has expressed interest in offering stablecoins.

The proposal arrives as lawmakers consider limits on who may trade prediction markets tied to government activity. Representative Bryan Steil introduced the Stop Lawmakers from Predicting Act, which would bar members of Congress, their spouses and dependent children from placing wagers on markets connected to legislation, official actions or election results. Supporters say the bill is intended to prevent elected officials from using nonpublic information for financial gain.

Schwab reported about $11.8 trillion in total client assets. The company’s shares traded lower on the day the plan was reported. The product launch timeline remains contingent on regulatory review and internal testing.