Roundhill Investments is set to launch the first US exchange-traded funds (ETFs) linked to prediction markets next week, while two other asset managers prepare similar products.
According to a filing with the U.S. Securities and Exchange Commission (SEC), Roundhill will list six funds tied to Democratic or Republican control of the White House, Senate and House.
The launch is scheduled for May 5, according to Bloomberg ETF analyst James Seyffart.
The funds are 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).
House and Senate products point to who controls them after the November 3, 2026 election, while presidential products point to the November 7, 2028 race.
The funds gain exposure through swap agreements referencing binary event contracts traded on CFTC-regulated markets. These contracts settle at $1 if an outcome occurs and $0 otherwise.
The prospectus warns in all capital letters that if the targeted party does not win, “the fund will lose substantially all of its value.”
Roundhill will not terminate the funds after settlement. Once the market prices a winner above $0.995 or below $0.005 for five consecutive trading days, the fund treats the outcome as decided and moves on to the next cycle, the 2028 House and Senate show for mid-term funds and the 2032 presidential race for BLUP and REDP.
The prospectus states that if the market later proves wrong, “there will be no recourse” for shareholders.
Bitwise and GraniteShares filed identical listings of six funds in February, with Bitwise using a “PredictionShares” brand. Their structures differ in that Bitwise’s funds end shortly after each outcome is determined, while GraniteShares, like Roundhill, goes into the next election.
Contracts relating to political events are already traded on prediction markets such as Polymarket and Kalshi, but integrating them into ETFs could broaden access by allowing them to be held in regular brokerage accounts and some retirement accounts.
The move comes after the CFTC in February withdrew a Biden-era proposal that would have banned contracts tied to political events, although state regulators in Massachusetts, New York, Nevada and elsewhere continue to challenge the underlying contracts in court.
Roundhill also filed to list apolitical prediction market ETFs tied to whether the U.S. enters a recession, according to a filing reported by Bloomberg ETF analyst Eric Balchunas.
