Charges, Guidelines & Methods to Commerce

Robinhood now enables you to commerce on the end result of real-world occasions — from Fed charge choices to elections to sports activities — by means of a product it manufacturers Predict. Beneath the hood, what you’re really shopping for is an occasion contract: a regulated by-product that pays $1 in case you’re proper and $0 in case you’re flawed. This text walks by means of what Robinhood prediction markets are, how occasion contracts work and what the CFTC says about them, what they price after the June 2026 price change, who’s eligible to commerce, and the dangers price understanding earlier than you fund an account.

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What Are Robinhood Prediction Markets?

Predict is the identify Robinhood provides the tab in its app the place you commerce occasion contracts. The instrument itself isn’t a Robinhood invention — occasion contracts are supplied by means of Robinhood Derivatives, LLC (RHD), a registered futures fee service provider with the CFTC and a member of the NFA, they usually commerce on one in all three exchanges: KalshiEX LLC, ForecastEX LLC, or Rothera Trade and Clearing LLC. Rothera is a CFTC-licensed trade and clearinghouse Robinhood runs by means of a three way partnership with Susquehanna Worldwide Group.

That construction issues. You’re not betting in opposition to Robinhood, and also you’re not betting in opposition to one other buyer instantly — you’re buying and selling a contract on a regulated trade, the identical fundamental structure as futures and choices, simply constructed round a yes-or-no query as an alternative of a value degree.

How Do Robinhood Prediction Markets Work?

Each occasion contract is a binary Sure/No query — “Will the Fed minimize charges in September?” or “Will Crew X win the championship?” — with two potential outcomes at settlement: the contract pays $1 per contract in case you’re proper, and $0 per contract in case you’re flawed. There’s no partial credit score and no sliding payout; it resolves to at least one or the opposite.

Earlier than settlement, contracts commerce anyplace from $0.01 to $0.99, and that value displays the market’s implied chance. A contract buying and selling at $0.65 implies the market presently sees roughly a 65% likelihood of that consequence — it’s not a forecast, and it’s not Robinhood’s opinion; it’s merely what consumers and sellers are keen to pay proper now, and it strikes as new info arrives. Robinhood’s personal steering is price repeating right here: if a query is worded as a double adverse, learn it fastidiously earlier than you decide a aspect.

What “Sure” and “No” Actually Imply

Shopping for “Sure” means you’re paying in the present day’s value for a declare that pays $1 if the occasion occurs as acknowledged, and $0 if it doesn’t. Shopping for “No” is the mirror picture — you’re taking the opposite aspect of the identical query. As a result of costs transfer repeatedly between $0.01 and $0.99, you don’t have to carry a contract to settlement; you possibly can promote it earlier than the occasion resolves if the worth strikes in your favor (or in opposition to you).

How Contract Costs Mirror Likelihood

Consider the worth as a working vote rely, not a assure. As cash strikes out and in of a contract, the worth shifts to replicate what the market presently believes is probably going. That’s a helpful option to learn the market, however it’s not the identical factor as a prediction of what’s going to really occur — a contract priced at $0.90 can nonetheless settle at $0, and does, at any time when the less-likely consequence happens.

What You Can Commerce on Robinhood Predict

As of August 2026, Robinhood Predict covers a variety of classes, and the combo goes properly past sports activities:

• Economics — together with Federal Reserve charge choices
• Politics and elections
• Crypto
• Local weather
• Commodities and metals
• Leisure
• Schooling
• Expertise
• Esports
• Sports activities — NFL, NBA, WNBA, faculty basketball, baseball, tennis, cricket, golf, soccer, MMA, boxing, racing, and chess

Sports activities will get essentially the most consideration as a result of it’s essentially the most acquainted entry level, however the fastest-growing classes on the platform proper now are financial and political — questions like Fed coverage and election outcomes, the place an occasion contract enables you to take a direct place on a real-world query relatively than buying and selling a inventory as a proxy for it.

Prediction Markets vs Sports activities Betting: What’s Really Completely different

That is the query most first-time readers even have, and it deserves a straight reply, not a dodge. Robinhood is specific that occasion contracts usually are not bets: they’re a type of hypothesis in prediction markets, and the excellence is structural, not simply semantic.

A sports activities wager is a personal settlement with a bookmaker at mounted odds the home units; you’re taking the opposite aspect of a wager in opposition to the home, and also you’re usually locked in till the occasion ends. An occasion contract is an exchange-traded by-product: the worth is ready by the market (different consumers and sellers), not by a bookmaker, it’s cleared by means of a CFTC-regulated trade, and — as a result of it trades repeatedly between $0.01 and $0.99 — you possibly can promote your place earlier than the occasion resolves as an alternative of ready it out. The economics and the oversight are totally different from a sportsbook, even when the underlying query (who wins a sport) sounds the identical.

That distinction is real, and it’s additionally why regulators are paying shut consideration to sports-based occasion contracts particularly. Sports activities contracts are essentially the most actively contested nook of this market: the class has drawn regulatory scrutiny, and a few states prohibit it outright (extra on that beneath). In the event you’re drawn to Predict primarily for financial, political, or crypto questions, that regulatory debate is essentially inappropriate; in case you’re drawn to it for sports activities, it’s price understanding the bottom remains to be shifting.

What Occasion Contracts Value on Robinhood

The price construction modified on June 1, 2026. Robinhood moved from a flat per-contract price to a probability-weighted fee:

fee = okay × p × (1 − p) × c

the place okay is 5% for Robinhood Gold members or 10% for everybody else, p is the contract value expressed as a decimal, and c is the variety of contracts. The result’s rounded as much as the closest $0.01 and capped at $0.01 per contract. There’s additionally a separate trade price, as much as $0.01 per contract, that varies by trade. Each the fee and the trade price apply on the best way in and the best way out — opening and shutting a place are every their very own commerce.

As a result of the formulation multiplies value by (1 − value), commissions are lowest at high-conviction costs close to the extremes ($0.01 or $0.99) and highest close to the center ($0.50), the place the cap tends to bind. Robinhood’s personal labored instance: shopping for 100 “Sure” contracts at $0.90, with a $0.01-per-contract trade price, prices $0.45 in fee with Gold ($91.45 complete) or $0.90 with out Gold ($91.90 complete).

Robinhood’s revealed fee desk for 100 contracts (Gold / with out Gold) reveals the sample clearly: $0.01 → $0.05 / $0.10, $0.10 → $0.45 / $0.90, $0.25 → $0.94 / $1.00, the $0.28–$0.72 vary → $1.00 / $1.00 (the place the $0.01-per-contract cap binds), $0.75 → $0.94 / $1.00, $0.90 → $0.45 / $0.90, and $0.99 → $0.05 / $0.10.

A fast word on Gold: it does minimize the fee charge in half, and that’s an actual quantity price understanding in case you’re evaluating prices. Nevertheless it’s an elective add-on, not a requirement — you don’t want Gold to commerce occasion contracts, and the account you really need first is the free Robinhood brokerage account paired with a separate, authorized Derivatives account (extra on that beneath).

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Who Can Commerce Occasion Contracts on Robinhood

Buying and selling occasion contracts requires a separate, authorized Robinhood Derivatives account — it’s distinct from a normal brokerage account, and approval considers your buying and selling expertise, funding profile, and state of residence.

A number of restrictions to know up entrance, plainly, as a result of they’ll have an effect on whether or not you possibly can really use this product:

• Predict is mobile-app solely. You’ll be able to view contracts on the internet, however you possibly can’t commerce them there, they usually’re not out there on Robinhood Legend.
• Maryland residents can’t commerce occasion contracts in any respect.
• Nevada residents can’t open new sports activities contracts, as of December 1, 2025.
• Employment-based restrictions apply to individuals who might maintain materials private info related to a given contract.
• You’ll be able to decide out of sports activities notifications and occasion contracts totally in account settings, in order for you the remainder of Robinhood with out this product.

Funding, Settlement, and Getting Paid

Occasion contract shopping for energy is separate out of your brokerage and crypto shopping for energy, and it sweeps mechanically between the 2 — you possibly can’t transfer it manually. On the spot Deposits will not be out there for occasion contracts, which implies in some circumstances solely absolutely settled money can be utilized to open a place.

When a contract settles, proceeds land again in your shopping for energy inside one enterprise day. Timing issues right here: an occasion that settles on a Friday might not depart you with usable funds till the next Monday.

Virtually, that is additionally why opening and funding the account early is price doing earlier than you’ve picked a contract, not after: since occasion contracts draw on settled money and a separate shopping for energy pool, your funds have to already be in place and settled by the point you discover a contract you need to commerce — not nonetheless clearing.

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Taxes and Your Annual Assertion

In the event you commerce occasion contracts, Robinhood points an occasion contracts annual assertion after year-end, usually in late January or early February, masking your transactions, prices, proceeds, charges, and web revenue or loss for the 12 months. Robinhood states plainly that this assertion is not a substitute tax reporting type. This text isn’t tax recommendation — in case you commerce occasion contracts, discuss to a tax skilled about find out how to report the exercise.

The Dangers — and What Prediction Markets Are Not

Not one of the above is price a lot with out being direct about what can go flawed, so right here it’s straight:

• You’ll be able to lose every thing you paid for a contract. If a contract settles in opposition to you, it pays $0. That’s a complete lack of the premium you paid for that place, not a partial one.
• Occasion contracts by means of Robinhood Derivatives usually are not FDIC insured and never SIPC protected. This can be a significant distinction from Robinhood’s brokerage accounts: SIPC protection applies to the brokerage entities (Robinhood Monetary / Robinhood Securities), to not Robinhood Derivatives, which is the place occasion contracts dwell. In the event you’re used to considering of your Robinhood account as SIPC-protected, that safety doesn’t lengthen to cash in occasion contracts.
• A contract’s value will not be a forecast. A $0.65 value means the market presently implies roughly a 65% likelihood — it doesn’t imply there’s a 65% likelihood, and it isn’t Robinhood (or anybody else) telling you what is going to occur.
• Occasion contracts usually are not bets, however they’re speculative. Robinhood’s personal language is that these are a type of hypothesis in prediction markets, not wagers in opposition to a home. That’s an correct description of the mechanism, not a declare that the end result is safer or extra predictable than a wager could be.
• Nothing right here is funding recommendation. This text explains how the product works; it doesn’t let you know which contracts to purchase or which outcomes are extra doubtless. That call, and the danger that comes with it, is yours.
• The regulatory image remains to be transferring. The CFTC has open rulemaking on occasion contracts, and sports-based contracts particularly stay essentially the most contested class, with state-level restrictions already in place in Maryland and Nevada. For the regulator’s personal client steering on this product, see the CFTC’s web page on prediction markets and occasion contracts, which covers what you’re entitled to as a buyer of a registered trade and what to be careful for.

None of this makes occasion contracts illegitimate — they’re a regulated, CFTC-overseen product, supplied by a licensed futures fee service provider, on licensed exchanges. It does imply the sincere model of this product is “a option to take a place on a real-world query, with actual and total-loss threat,” not “a straightforward option to generate profits,” and any protection that skips the second half isn’t providing you with the total image.

Is Robinhood Predict Price It?

Robinhood Predict makes essentially the most sense for somebody who’s already comfy with Robinhood, desires to take a small, defined-risk place on a particular real-world query — a charge resolution, an election, a crypto milestone — and understands entering into {that a} flawed name means dropping the total quantity paid for that contract, not one thing smaller. The decrease price at high-conviction costs (close to $0.01 or $0.99) additionally means it matches finest with clear, high-confidence views relatively than coin-flip questions, the place the fee construction eats extra of any edge.

It makes much less sense for anybody on the lookout for an alternative choice to a diversified investing technique, anybody who isn’t ready to deal with the quantity paid for a contract as cash they might absolutely lose, and — given the mobile-only design and state restrictions — anybody who must commerce from a desktop or who lives in Maryland (occasion contracts usually) or Nevada (new sports activities contracts particularly).

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Steadily Requested Questions