You face numerous challenges and risks-some you may try to mitigate, and some you can’t.įor example, if your business is subject to interest rate, currency, or commodity price risk, you can hedge against any of these risks in the futures, options, or swap markets. Suppose you’re a manufacturer operating in today’s marketplace.
While markets like PredictIt meet the demand of those who want to speculate on political outcomes, they also accommodate businesses that seek to hedge against adverse consequences from such outcomes. The CFTC appears to agree, with a long history of looking askance at markets offering this service to the public. One might think no public benefit is gained by gambling on elections.
The Commodity Futures Trading Commission intends to withdraw authorization that allows a popular venue for placing such bets, called PredictIt, to operate. If the federal government has its way, soon you won’t be able to bet on the outcome of certain events, such as political elections.
