Prediction market platform Kalshi Inc. is expanding outside the US for the first time, partnering with Brazil’s XP Inc . to list event contracts. Kalshi will start offering yes-or-no contracts tied to Brazil’s economy, on events such as changing inflation and interest rates in the country, co-founder Luana Lopes Lara said. Those contracts will be available for Kalshi’s US investors and select XP u...
Prediction market platform Kalshi Inc. is expanding outside the US for the first time, partnering with Brazil’s XP Inc . to list event contracts. Kalshi will start offering yes-or-no contracts tied to Brazil’s economy, on events such as changing inflation and interest rates in the country, co-founder Luana Lopes Lara said. Those contracts will be available for Kalshi’s US investors and select XP users in Brazil, according to executives. “It makes sense for us to go through these international partners,” said Lopes Lara, who is from Brazil. “They already have the customers, they have the brand.” Kalshi said last year that it hopes to expand internationally to more than 140 countries. The Brazil business is one of the first concrete moves in that direction. The startup’s business in the US has boomed over the past year, largely due to the expansion of sports betting on the platform. But it also offers a way to wager on everything from elections to geopolitical events. XP, the biggest brokerage firm in Brazil, had 4.8 million active clients in December. The firm runs an investment supermarket akin to Charles Schwab Corp. in the US. XP pioneered the model in Brazil, but in the post-pandemic years, equity trading contributed to less of its growth as rates soared. XP has been seeking to diversity its offerings, including through a push into private banking . “When we saw prediction markets, we saw markets that could be not only innovative but disruptive,” Lucas Rabechini , head of financial products at XP, said. “We see a lot of structured notes and options of interest rates being traded on the traditional markets,” he said. “In prediction markets, we see something comparable in terms of assets and payoff.” Predictions will be first available for clients of Clear Corretora, one of XP’s brands, that have an international account, and the products will be listed through the company’s US brokerage arm. Being the first mover in prediction markets is “core” to XP, Rabechini sa...
MCCAIG/E+ via Getty Images I was drinking my coffee. I'd almost forgotten there was a war in Iran and that the markets would soon open the futures session. Like every Sunday, I had to check the prices. This weekend more than any other. But I didn't have time when, suddenly, my phone started going crazy with notifications. They were all alerts I'd written down last week, about -1% from the closing ...
MCCAIG/E+ via Getty Images I was drinking my coffee. I'd almost forgotten there was a war in Iran and that the markets would soon open the futures session. Like every Sunday, I had to check the prices. This weekend more than any other. But I didn't have time when, suddenly, my phone started going crazy with notifications. They were all alerts I'd written down last week, about -1% from the closing prices for stock indices (from the US to Japan) and +5% for oil, just to "be on the safe side" in case I'd forgotten. Then suddenly everything buzzes at once, and I realize something's wrong. Those two minutes of relaxation really didn't last long. I came back to reality by opening my Bloomberg Terminal: there's a war in Iran, and oil has broken $100. Now we're here. Here's what could happen. The $100 Threshold When you read " Oil back above $100 ", what you are seeing is not just a figure but actually a perception that can influence people's trading behavior. It's signaling a mindset that's changing traders' behavior. Because at $99 , oil is "high." At $101 , it suddenly becomes a problem. Seeking Alpha In the market, what may seem like a small difference is a very large one. And once that barrier has been passed, several things happen automatically. Companies that rely on oil (like airlines, trucking companies, etc.) hedge to protect against a rise in the cost of oil. Where I live (I live in Europe), gasoline is around 70% higher than in many places. Traders are going to start to hedge even more, and risk managers will start asking for exposure to be reduced. Or, in other words, the entire financial system will go into defensive mode. It's a domino effect. The major point here is the difference between fear of high-priced oil and fear of high-priced volatile oil; if the price of oil increases at a slow pace over an extended period, it allows time for economic adjustment, but as soon as the price of oil rises quickly and breaks past those psychologically significant levels...
Sylvia Sheng of JPMorgan Asset Management says Asian markets are seeing "a de-risking event happening" in light of the ongoing conflict in the Middle East. (Source: Bloomberg)
Sylvia Sheng of JPMorgan Asset Management says Asian markets are seeing "a de-risking event happening" in light of the ongoing conflict in the Middle East. (Source: Bloomberg)
"Bloomberg: The Asia Trade" brings you everything you need to know to get ahead as the trading day begins in Asia. Bloomberg TV is live from Sydney and Singapore with Haidi Stroud-Watts and Avril Hong, getting insight and analysis from newsmakers and industry leaders on the biggest stories shaping global markets. (Source: Bloomberg)
"Bloomberg: The Asia Trade" brings you everything you need to know to get ahead as the trading day begins in Asia. Bloomberg TV is live from Sydney and Singapore with Haidi Stroud-Watts and Avril Hong, getting insight and analysis from newsmakers and industry leaders on the biggest stories shaping global markets. (Source: Bloomberg)