KUALA LUMPUR, June 27 (Bernama) -- Interactive Brokers Group, an automated global electronic broker, announced its wholly-owned subsidiary, ForecastEx LLC, has received the necessary designations from the Commodity Futures Trading Commission (CFTC) to operate a contract market and derivative clearing organisation.
ForecastEx will commence operations on July 8, and Interactive Brokers clients from eligible countries will have immediate access. Interactive Brokers is the first Futures Commission Merchant to join as an exchange member.
Interactive Brokers Group Chairman and Founder, Thomas Peterffy said ForecastEx is a prediction market that the firm has been working on and experimenting with for nearly 10 years.
“Planning for the future is the ultimate task for any business leader, government official or individual. We may adjust our plans based on consensus forecasts or express our disagreement to earn a profit or hedge our exposures,” he said in a statement.
Contracts listed on ForecastEx are simple and intuitive with contract purchase prices ranging from US$0.02 and US$0.99, in which the value of these contracts will continue to fluctuate based on market participants’ evolving judgement of probabilities, directly reflecting the collective market view of the likelihood of the event. (US$1=RM4.71)
Upon the event's resolution, the contract settles at a predefined value, US$1 for a correct contract and US$0 for the incorrect one.
ForecastEx contracts are ideal for establishing the consensus view on controversial issues and hedging economic exposure, and have weekly, monthly, quarterly and annual durations.
Eligible clients of Interactive Brokers LLC, Interactive Brokers Hong Kong Limited, and Interactive Brokers Singapore Pte Ltd can trade ForecastEx contracts on IBKR ForecastTrader.
After its initial launch, ForecastEx will expand internationally and cover additional local and controversial global issues. Contracts will be limited only by the availability of credible, impartial arbiters of event resolutions.
-- BERNAMA
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