The Inaugural U.S. Election Prediction Market ETFs Are Set to Debut on Wall Street

Roundhill Investments is poised to introduce the first-ever U.S. exchange-traded funds (ETFs) linked 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 (SEC), Roundhill plans to list six funds tied to the potential control of the White House, Senate, and House by either Democrats or Republicans. The launch date is scheduled for May 5, as confirmed by Bloomberg ETF analyst James Seyffart.

These funds include the Roundhill Democratic President ETF (BLUP), Republican President ETF (REDP), Democratic Senate ETF (BLUS), Republican Senate ETF (REDS), Democratic House ETF (BLUH), and Republican House ETF (REDH). The House and Senate products are connected to the outcome of the November 3, 2026, elections, while the presidential products are linked to the November 7, 2028, election. The funds achieve exposure through swap agreements that reference 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 explicitly warns that if the targeted party fails to win, the fund will lose nearly all its value.

Roundhill has no plans to terminate these funds after settlement. Once the market determines a winner at above $0.995 or below $0.005 for five consecutive trading days, the fund treats the outcome as decided and transitions into the next cycle - the 2028 House and Senate exposure for the midterm funds and the 2032 presidential race for BLUP and REDP. The prospectus notes that if the market is later proved incorrect, there will be no recourse for shareholders. Bitwise and GraniteShares have filed identical six-fund slates in February, with Bitwise using a 'PredictionShares' brand.

Their structures differ, as Bitwise's funds terminate shortly after each outcome is determined, while GraniteShares, like Roundhill, rolls into the next election. Although political event contracts are already traded on prediction markets such as Polymarket and Kalshi, packaging them in ETFs could expand access by allowing them to be held in ordinary brokerage accounts and certain retirement accounts.

This development comes after the CFTC withdrew a Biden-era proposal in February that would have banned political event contracts, despite ongoing challenges from state regulators in Massachusetts, New York, Nevada, and elsewhere in court. Roundhill has also filed to list non-political prediction market ETFs tied to the possibility of the U.S. entering a recession, according to a filing flagged by Bloomberg ETF analyst Eric Balchunas.