Schwab to Offer Yes‑No S&P 500 Prediction Contracts

Charles Schwab will offer yes-or-no contracts that let customers wager on whether the S&P 500 closes above or below specified target prices. The contracts resolve to a binary outcome at the market close and settle in cash.

Schwab plans to distribute the contracts through Cboe Global Markets and aims to launch the product within months. The offering will be limited to index-closing price outcomes rather than events tied to politics, sports, weather or individual companies.

The product would mark Schwab’s first entry into prediction-style markets. Earlier this year the firm launched spot Bitcoin and Ether trading for retail clients. Schwab reported net income of $2.5 billion for the first quarter of 2026.

Private platforms such as Kalshi and Polymarket already offer event contracts tied to the S&P 500. Cryptocurrency exchanges have also developed prediction offerings. Some industry estimates project annual volume in event-contract trading could reach as much as $1 trillion by 2030.

Regulatory scrutiny of prediction markets is active. State gaming regulators have challenged certain event contracts, particularly those tied to sports. Federal lawmakers have proposed measures to restrict trading by some officials and to tighten oversight of platforms. The Commodity Futures Trading Commission has taken the position that event contracts qualify as “swaps” and fall under its exclusive regulatory jurisdiction. Legal disputes between platforms, state authorities and federal regulators remain unresolved.

Contracts of this type typically settle in cash based on whether a stated event occurs, and traders use them for speculation and hedging. Schwab has not disclosed full product design or its regulatory strategy. If launched through Cboe, the product would add a major retail brokerage to the list of firms offering event-based financial instruments, while ongoing legal and regulatory developments will shape how the market operates.