The planned product would give clients a way to place directional bets on index movements, as competitors like Coinbase and Robinhood continue expanding into prediction markets.
Charles Schwab is reportedly partnering with Cboe Global Markets to launch a new type of options contract that enables investors to make binary, yes-or-no bets on the S&P 500’s performance. According to a Wall Street Journal report, the initiative would mark Schwab’s first step into the prediction markets space.
The offering is expected to be introduced to Schwab customers in the coming months, the report said, citing sources familiar with the matter.
Unlike traditional prediction platforms such as Polymarket and Kalshi, which typically use futures-style contracts tied to event outcomes, Schwab’s product would operate more like a binary option—paying a fixed amount if a specified condition is met or expiring worthless if it is not.
Schwab and Cboe are also considering a similar structure tied to Cboe’s “Plus Zone” feature, which would allow partial payouts when predictions come close to the final result, even if they do not hit the exact target.
The companies have discussed expanding the offering beyond the S&P 500 to include other indexes and financial benchmarks. However, Schwab is expected to focus on contracts linked to clearly measurable financial outcomes, avoiding markets tied to politics, sports, or other real-world events.
If launched, Schwab would join a rapidly growing prediction markets sector. Platforms like Kalshi and Polymarket have seen rising interest from traders speculating on outcomes ranging from elections to economic data releases.
At the same time, crypto and retail brokerages are moving into the space, with Coinbase (COIN) and Robinhood (HOOD) recently introducing their own prediction market products.
