How event contracts work
Event contracts are built on a simple binary structure: you take a position on whether a specific outcome will happen. Contracts are priced between $0.01 and $0.99, with the price reflecting the market's implied probability of a Yes outcome. If your position is correct when the contract settles, you receive $1 per contract.
Every event contract has exactly 2 sides, a Yes and a No. You buy Yes if you believe the stated outcome will occur, and No if you believe it won't.
If the event question contains a double negative, read carefully before choosing your side. For example, if the question is "Will there be NO change in price?" and you purchase a No contract, you're speculating that there will be a change in price.
Contract prices range from $0.01 to $0.99 and reflect the market's implied probability. A contract priced at $0.70 means the market implies roughly a 70% chance the outcome occurs. The other side (the No contract) would be priced at approximately $0.30.
All event contracts settle in cash. There's no physical delivery. The maximum payout per contract is $1. The minimum payout is $0. There are no other settlement values for standard contracts.
All contract-specific information is in the About section of the event detail page or the contract terms and conditions. These show the threshold definition, the data source used for settlement, the expiration time, and any special settlement rules that apply to that contract. Check these resources before trading to understand how a specific contract will settle.
For multiple contracts, use the drop down menu to the right of About to select and view them for each contract.
The maximum profit you can make per contract is generally the difference between the contract price for the side you’re purchasing and $1 (minus any applicable fees).
Let's say you buy a Yes contract trading at $0.47. The contract has a $0.01 exchange fee and a $0.01 Robinhood commission per contract traded. This makes your total cost per contract $0.49. If you hold the correct outcome, the total value of the contract is worth $1, which means you have a maximum potential profit of $0.51 per contract you hold ($1- $0.49).
At settlement, the exchange determines the final outcome based on official data sources defined for that contract. Settlement rules, including which data source is used and how nonstandard outcomes are handled, are specified in the contract terms. You can access these via the event detail page under About.
Robinhood uses the official data source specified by the exchange for each contract. The exchange's determination is final. Robinhood can't override exchange settlement, even if third-party sources (such as sports apps or news sites) show a different result.
If you believe a settlement result is incorrect, the exchange partner makes all final determinations. You may review the Terms and Conditions provided by the exchange to verify the data source and settlement terms. Robinhood doesn't have the ability to change or modify settlement outcomes.
Many event contracts are based on a numerical threshold (for example, "Will the team score more than 3 goals?"). Understanding how the threshold is defined is important because it determines which side wins.
Contract terms use precise language. "Above" and "over" typically mean strictly greater than the threshold, meaning the threshold value itself does not qualify. "Below" and "under" typically mean strictly less than the threshold. Always read the specific contract terms to confirm.
If the outcome lands exactly at the threshold, whether the Yes contract pays $1 or $0 depends on whether the contract uses a strict inequality (greater than, >) or an inclusive inequality (greater than or equal to, >=). A contract that says "more than 100" would settle at $0 if the result is exactly 100. A contract that says "100 or more" would settle at $1. The contract terms define which applies.
Some contracts use "+" notation (for example, "5+ blocked shots"). This means 5 or more. A result of exactly 5 would satisfy the condition.
The exact threshold definition for your contract is in the About or Terms and conditions section of the event detail page in the app. Always check this before trading if the outcome is near a boundary value.
If an event is canceled before or during trading (for example, a postponed game or a canceled match), the exchange determines how contracts settle. This may result in a full refund to your buying power, a $0 settlement, or a nonstandard payout. This outcome will be reflected in your Robinhood app.
For player markets contracts, if a player doesn't participate in the event, that contract may be voided or settled at a fallback value (for example, $0.50) as determined by the exchange. Review the specific contract's terms for the exact rule.
If 1 leg in a combo has a nonstandard payout and all other legs resolve correctly, the maximum payout per contract for the entire combo is the nonstandard payout amount. If multiple legs have nonstandard payouts, the final payout is calculated by multiplying the payout value of each leg. For example, if legs 1 and 2 each have a nonstandard payout of $0.50 and legs 3 and 4 settle at $1, the per-contract payout is $0.25 ($0.50 x $0.50 x $1 x $1).
The exchange reserves the right to determine how all nonstandard outcomes are settled.
Restrictions and eligibility requirements apply. Futures, options on futures, and cleared swaps trading involves significant risk and is not appropriate for everyone. Carefully consider if it's appropriate for you in light of your personal financial circumstances. Displayed prices are based on real-time market sentiment.
Read the Event Contracts Risk Disclosure for more information about the risks associated with event contracts.
Futures, options on futures and cleared swaps trading is offered by Robinhood Derivatives, LLC, a registered futures commission merchant with the Commodity Futures Trading Commission (CFTC) and Member of National Futures Association (NFA). Event contracts are offered by Robinhood Derivatives, LLC through either KalshiEX LLC, ForecastEX, LLC or Rothera Exchange and Clearing LLC.