Robinhood event contracts
Event contracts will allow you to speculate on the outcome of a specific event in the future. The inaugural event contract at Robinhood will be an election event contract between presidential nominees Kamala Harris and Donald Trump. Stay tuned for more event contracts to be added in the future.
What is an event contract?
An event contract is a type of financial derivative that allows traders to speculate on the outcome of a specific event. These contracts are generally structured around “Yes” or “No” outcomes, and fluctuate in price based on the projected outcome of the event. Event contracts then pay out if the position held matches the correct outcome of the event (for example, which candidate will win the 2024 presidential election); otherwise, they expire worthless.
Eligibility and application
To purchase event contracts through Robinhood, you must apply for, and have an approved, Robinhood Derivatives account.
To be eligible to open a Robinhood Derivatives account, you must be a US citizen and have an open individual investing account with either:
- Margin investing enabled, or
- Options trading approved (Level 2 or 3)
To apply for a Robinhood Derivatives account:
- Select the 2024 presidential election card from Investing and select Buy Candidate
- Select Continue to apply for a Robinhood Derivatives account and follow the instructions
How does it work for the 2024 election?
You can buy an event contract at Robinhood to speculate on the outcome of the election. To open a contract, select the candidate and enter the number of contracts you wish to buy. The value of each underlying contract can equal up to $1.00, but may have a notional value less than $1.00.
The final cash settlement price can vary from $0.00 to $1.00, and upon final settlement, the owners of contracts of the correct outcome will receive $1.00 per contract. This will be paid out on January 8, 2025 after the presidential results are certified by the US Congress on January 6, 2025. The owners of contracts that were incorrect will receive $0.00 per contract and their positions will be settled worthless.
To open a position in a candidate, you would purchase a Yes [Candidate] position. To close an existing position you would buy the opposite side of the same contract, which is a No [Candidate] position.
Every Yes trade is paired against a No trade. At Robinhood, you cannot buy a No position, unless it is to close out your existing Yes position, and you can’t simultaneously hold a Yes position for both candidates.
If you believe Candidate A will win the election, you could buy a Yes Candidate A position for the price of XX¢. After you open a position, the contract value will then fluctuate in real time based on the open market. So, if you purchase a Yes Candidate A position for $0.50 and their Yes market price subsequently increases from $0.50 to $0.52, your position will increase by $0.02 (to $0.52) per contract you hold. You can choose to close this position at any time, or hold the contract until final cash settlement. Upon final settlement, if Candidate A is elected as the 2024 President, your position value would increase to $1.00 per contract you hold. If Candidate A is not elected, your Candidate A positions would be worth $0.00.
You can exit your position before the last day to trade which is January 5, 2025 at 11:59:59 PM CT, provided there is a market participant for the opposite side of the contract.
Trading the 2024 election contract
Once you have an open Robinhood Derivatives account, you can trade event contracts in-app by scrolling down on your Investing screen and selecting the US presidential election card.
From there you will see the value of each position and the option to purchase event contracts for either candidate.
To buy an event contract:
- Select Buy Candidate for the candidate who you believe is going to win the election
- Select the quantity of Yes contracts you wish to purchase
- Review the order details
- Swipe up to submit
To close a position:
- Select Trade from your position
- Select Close position
- Select the quantity of contracts you wish to close out. This purchases the same quantity of No contracts you select.
- Review the order details
- Swipe up to submit
When you close a position, you are actually buying a No position in the same candidate you previously had a Yes position in. At Robinhood, you cannot purchase No contracts unless you are closing out of an existing long position.
All event contract orders will be submitted as marketable immediate-or-cancel (IOC) limit orders. We do not offer stop or limit orders. Furthermore, these contracts trade on an open market at a regulated exchange, meaning there must be a market participant willing to take the opposite side of your order for your trade to execute. If we are unable to execute your trade in a timely manner, it means that the exchange was unable to match and execute your order, or there is no one willing to participate in the opposite position. In the event your order is unable to execute, it will be canceled or rejected.
Fees and commissions
Robinhood charges a $0.01 commission per contract. The exchange that executes your orders, ForecastEx, embeds $0.01 within the price of the contract, so that the Yes and No contracts add up to $1.01. At settlement, the winning side will be paid out $1.00.
At Robinhood, there are no additional commissions or fees to hold your position until final cash settlement.
Let’s say you buy Yes Candidate A at a price of 60¢ per contract. The price of Yes Candidate A then increases to 70¢, and you choose to close out of your position, which is done by buying No Candidate A contracts. If the price of the Yes Candidate A is 70¢ then conversely, the price for No Candidate A is 31¢ (which is calculated by subtracting the Yes price minus $1.01). If your order to close Candidate A (ie. Buy No) is executed, then your account will realize a profit of 9¢ per contract and your buying power will increase by 68¢ ($1.00 - $0.31 - $0.01 in commissions) per contract.
Funding and buying power
Your Robinhood Derivatives account is funded through your investing account. However, the amount available for trading event contracts (known as your event contract buying power) may be slightly different from what you see in your investing account. This is because the buying power used to purchase derivatives is calculated differently. You can view your event contract buying power in Investing → Buying power.
If your instant deposit access is restricted and you’d like to purchase event contracts, you can deposit funds via debit card funding (DCF) or by wire transfer.
Trading hours
Trading hours for the 2024 election contract will vary. There will be separate hours for pre-election week, election week, and post-election week.
For clearing purposes, trades placed on or after 4:15 PM are considered T+1 (next trade day), meaning a trade placed at 4:20 PM CT on Friday will have a Saturday trade date.
Pre-election week hours
Through November 2, 2024, trading hours are as follows.
| Monday, 10/28 | Tuesday, 10/29 | Wednesday, 10/30 | Thursday, 10/31 | Friday, 11/1 | Saturday, 11/2 |
| 7:00 AM - 4:00 PM CT | 7:00 AM - 4:00 PM CT | 7:00 AM - 4:00 PM CT | 7:00 AM - 4:00 PM CT | 7:00 AM - 4:00 PM CT | Closed |
| 4:15 PM - 7:00 PM CT | 4:15 PM - 7:00 PM CT | 4:15 PM - 12:00 AM CT | 4:15 PM - 12:00 AM CT | 4:15 PM - 9:30 PM CT | Closed |
Election week hours
There will be virtually 24 hour trading the week of the election, starting November 3 at 2 AM CT to November 8, 2024 at 4:00 PM CT, with a 15 minute closed maintenance window each day.
| Sunday, 11/3 | Monday, 11/4 | Tuesday, 11/5 | Wednesday, 11/6 | Thursday, 11/7 | Friday, 11/8 | Saturday, 11/9 |
| 2:00 AM - 4:00 PM CT | 12:00 AM - 4:00 PM CT | 12:00 AM - 4:00 PM CT | 12:00 AM - 4:00 PM CT | 12:00 AM - 4:00 PM CT | 12:00 AM - 4:00 PM CT | Closed |
| 4:15 PM - 12:00 AM CT | 4:15 PM - 12:00 AM CT | 4:15 PM - 12:00 AM CT | 4:15 PM - 12:00 AM CT | 4:15 PM - 12:00 AM CT | Closed | Closed |
Post-election week hours
For trading hours after November 8, 2024, please reference the ForecastEx Trading Schedule.
Key dates and payout
There are a few key dates and times to consider when buying a 2024 election contract.
- November 5, 2024: Presidential election day
- January 5, 2025: Last day to trade the 2024 election contract
- You can trade until 11:59:59 PM CT provided there is a buyer willing to take the opposite side of your position
- January 6, 2025: Election results certified by Congress
- January 7-8, 2025: Event contracts pay out $1.00 to the contract holders of the correct outcome
Order execution and market conditions
Election markets are new and still evolving, with limited exposure to past election events. Because of this, liquidity and volatility can be more dramatic than traditional equities markets, which might affect whether your orders get filled. With these fluctuations, you might see more order cancellations or rejections if the price you enter can’t be matched or if market conditions change significantly.
If we’re unable to execute your trade quickly, it could be because the exchange couldn’t match your order or there weren’t participants on the other side. All event contract orders are submitted as immediate-or-cancel (IOC) limit orders and will be canceled or rejected if they aren’t immediately filled.
Robinhood offers event contracts through our membership with ForecastEx, and these contracts are only traded there. If ForecastEx isn’t available or lacks liquidity, you may not be able to open or close a position. ForecastEx also follows its own exchange rules, including requirements regarding pricing thresholds (see ForecastEx Rule 403). For more information, refer to the ForecastEx Rulebook.
Beginning on Election Day, November 5, market participation may be limited as election results start to roll in. Trading interest in these contracts may decline, which could make it more challenging to fill orders due to difficulty finding a counterparty to match the trade.
FAQ
Robinhood is able to offer event contracts through Robinhood Derivatives and its membership with ForecastEx, a Designated Contract Market, regulated by the Commodity Futures Trading Commission (CFTC).
Each contract is traded in cents at the exchange and represents a probability between $0.00 and $1.00, with each cent effectively representing a 1% probability that the event will occur. For example, if a candidate’s contract is priced at 53 cents, this can be interpreted as a 53% probability that the candidate will win according to traders of the open market.
Note that for this event contact, the exchange that executes your orders, ForecastEx, embeds $0.01 within the price. Therefore, the two sides of the contract add up to $1.01 or 101%. So it’s not an exact probability. Your order will only be executed if the two sides of the contract add up to $1.01.
The 2024 election contract is traded on an exchange, through ForecastEx, and fluctuates in value based on an open market, similar to stocks, ETFs, futures, and options. In other words, the contract value fluctuates based on trading demand.
As news rolls in, it is important to note that prices will become more volatile.
Each contract represents a probability between $0.00 and $1.00, with each cent effectively representing a 1% probability that the event will occur. For example, if a candidate’s contract is priced at 53 cents, this can be interpreted as a 53% probability that the candidate will win according to traders of that open market.
Event contracts typically trade on binary outcomes. At launch, we are offering event contracts specifically for the two primary candidates in the 2024 Presidential Election: Trump and Harris. Additional contracts may be considered in the future, but for now, you can only trade on these two candidates at Robinhood.
Robinhood is committed to democratizing finance for all, regardless of who is in office. Although we are allowing our customers to speculate on the outcome of the 2024 Presidential Election, results and real-time market fluctuation do not indicate an endorsement of either candidate from Robinhood.
Event contracts will pay out to the holder of the contracts whose candidate is certified by the U.S. Congress.
Currently, our presidential election event contracts are only available to trade in-app.
Please review the ForecastEx Terms and Conditions for a complete list of persons prohibited from buying event contracts.
We are working hard to offer outright futures to traders as soon as possible. Stay tuned for updates!
We won’t increase or decrease your buying power based on the gains or losses of the event contract while you hold the position. When you close your position or when payout occurs, we will credit your account and you will notice any applicable impact to your buying power.
For cash accounts, the buying power will only update after the funds have been transferred between entities, which typically happens on the next trading day (T+1).
Robinhood will report payments to the appropriate tax authorities as required using the applicable tax forms, such as Form 1099, or any other relevant tax document. As a reminder, Robinhood doesn’t provide tax advice. For specific questions, we recommend consulting a tax professional.
Is Robinhood using this information to generate its own polling data?
- No, Robinhood is not using this information to generate its own polling data.
Can anyone see who I bought a contract for?
- Robinhood keeps all information and positions private.
Are you selling my voting information?
- No, Robinhood is not selling voting information. Please note that trading election event contracts is not the same as voting. All transactions are kept private.
Disclosures
Commodity interest trading involves significant risk and is not appropriate for everyone. Please carefully consider if it's appropriate for you in light of your personal financial circumstances. Restrictions and eligibility requirements apply.
Please read the Futures Risk Disclosure Statement prior to trading futures products, and please read the Forecast Contract Risk Disclosure for more information about the risks associated with forecast event contracts.
RHD accounts are not protected by the Securities Investor Protection Corporation (SIPC) and are not Federal Deposit Insurance Corporation (FDIC) insured.
Prior to trading virtual currency Futures products, please review the NFA Investor Advisory & CFTC Advisory providing more information on these potentially significant risks.
Please remember that Robinhood Derivatives, LLC retains the right to cancel orders and liquidate your positions at any time, without prior notice. Please see your RHD Client Agreement for more details.
Commodity interest 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) (NFA ID 0424278).