Charles Schwab Expands Into Prediction Markets With Cboe Partnership

The upcoming contracts differentiate themselves from the futures-based models used by platforms like Kalshi and Polymarket by utilizing an options-based structure. According to reports, the firm intends to roll out these tools to its customer base in the coming months, focusing on measurable market outcomes. Beyond the binary win-or-lose nature of all-or-nothing trades, Schwab plans to incorporate a "plus zone" mechanism, which offers partial payouts to traders whose forecasts fall within a specific range of the actual closing level. Discussions between the two firms also suggest potential expansion into contracts linked to other major market indexes.

This entry into the prediction space aligns with Schwab’s aggressive diversification of its trading services. Alongside these market-tracking contracts, the brokerage is scaling its digital asset infrastructure. The firm has set a 2027 target to integrate spot cryptocurrency trading, transfers, and custody capabilities for registered financial advisors, building on the existing Bitcoin and Ethereum access already available to retail clients. By blending event-driven options with expanded crypto services, Schwab is positioning itself to compete directly with firms like CME Group and Interactive Brokers for a larger share of the retail and institutional trading market.