Event Futures Trading and Investing

Economic and event futures, options, and derivatives are innovative products that aren’t typically backed by an underlying physical commodity or financial asset—they are based on the likelihood of a particular event taking place, or with a particular outcome. Often called non-traditional or alternative investment markets, they can be structured similar to the traditional futures contract model, as over-the-counter derivatives, or as “binary” contracts, which have only two trading outcomes at a set expiration date.

While event markets exist in anything from politics to sports in unregulated venues, one of the benefits of U.S. exchange-traded event futures is that they are offered in a regulated marketplace, and backed by a clearinghouse guarantee.

In the U.S., you can trade economic and event contracts at CME Group. Like traditional futures markets, they are both speculative and hedging vehicles and attract a wide range of users.