The launch of ForecastEx, a prediction exchange specializing
in economic and climate events, has been postponed until later in the summer
due to administrative issues, according to Steve Sanders, EVP of Marketing and
Product Development at Interactive Brokers.
ForecastEx Market Designations Approved
ForecastEx, a wholly-owned subsidiary of Interactive Brokers
Group, has received the required designations from the Commodity Futures
Trading Commission (CFTC) to operate as a contract market and derivative
clearing organization. The exchange was originally planned to begin operations
on Monday, July 8, 2024.
Steve Sanders informed Traders Magazine that ForecastEx will
allow Interactive Brokers’ clients in eligible countries to trade forecast
contracts on the probabilities of future US economic and global climate events.
He explained that US economic events encompass Unemployment Claims, the
Consumer Price Index, Retail Sales, Fed Funds, Housing Starts, and others,
while global climate events include temperatures and atmospheric CO2 levels.
“To trade, clients simply choose YES or NO on a forecast
contract,” Sanders said. “We have been interested in this topic for a very long time,
and it is a good way to understand the consensus view on controversial issues,”
he added.
ForecastEx Targets FCM Engagement
Thomas Peterffy, Founder and Chairman of Interactive
Brokers, has been working on and experimenting with ForecastEx for nearly ten
years. Sanders noted, “But we’ve had other priorities.” “We started earnestly working on it in November 2021,”
Sanders stated.
Interactive Brokers is the first Futures Commission Merchant
(FCM) to join ForecastEx as an exchange member. Sanders mentioned,
“Reinvigorating the FCM community is a big part of ForecastEx’s model and
ForecastEx is actively reaching out to other FCMs to join in the effort.”
Eligible individual and institutional investor clients of
Interactive Brokers LLC, Interactive Brokers Hong Kong Limited, and Interactive
Brokers Singapore Pte. Ltd. will be able to trade forecast contracts on IBKR
ForecastTrader, a speciality trading platform.
Sanders believes that retail investors are sophisticated
enough to invest in these types of instruments. “Contracts listed on ForecastEx
are simple and intuitive, and individual investors with knowledge of the
economy could be interested in these contracts,” he said.
This article was written by Tareq Sikder at www.financemagnates.com.
Source
