Schwab to offer S&P 500 yes-or-no options with Cboe

Charles Schwab is partnering with Cboe Global Markets to offer new yes-or-no options contracts tied to the S&P 500, marking the brokerage’s first move into prediction markets. The feature is expected to be available to Schwab customers in the coming months. The contracts would work like binary options, paying a fixed cash amount or expiring worthless depending on whether the index closes above or below a preset target price.

Schwab and Cboe are also discussing a version that uses Cboe’s Plus Zone feature to deliver partial payouts when a prediction lands close to the final outcome. Executives have considered expanding the lineup to other market indexes or financial benchmarks, but plan to focus on events with objectively verifiable outcomes in financial markets rather than contracts tied to politics, sports or other nonfinancial events.

The launch would add Schwab to a growing group of platforms in the prediction-markets space.

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