Roundhill Investments is poised to introduce the inaugural U.S. exchange-traded funds tied to prediction markets, with two additional asset managers preparing to launch similar products. According to a filing with the U.S.

Securities and Exchange Commission, Roundhill will list six funds linked to the control of the White House, Senate, and House by Democrats or Republicans. The launch is scheduled for May 5, as reported by Bloomberg ETF analyst James Seyffart.

The funds include the Roundhill Democratic President ETF, Republican President ETF, Democratic Senate ETF, Republican Senate ETF, Democratic House ETF, and Republican House ETF. These products are tied to the outcomes of the upcoming elections, with the House and Senate funds focused on the November 3, 2026, elections, and the presidential funds centered on the November 7, 2028, election.

The funds gain exposure through swap agreements referencing binary event contracts traded on CFTC-regulated markets, which settle at $1 if the predicted outcome occurs and $0 if it does not. The prospectus cautions that if the targeted party does not win, the fund will lose nearly all its value. Roundhill has opted not to terminate the funds after settlement; instead, once the market prices a winner above $0.995 or below $0.005 for five consecutive trading days, the fund will treat the outcome as decided and transition into the next cycle. The prospectus also notes that if the market's prediction is later proved incorrect, there will be no recourse for shareholders.

Other companies, such as Bitwise and GraniteShares, have filed similar proposals, with distinct structures, including termination after each outcome is determined. The introduction of these ETFs could expand access to prediction markets, allowing them to be held in ordinary brokerage accounts and certain retirement accounts. This development follows the CFTC's withdrawal of a proposal that would have banned political event contracts, although state regulators continue to challenge these contracts in court.

Roundhill has also filed to list non-political prediction market ETFs tied to the possibility of a U.S. recession.