Market-Makers Use Event Contracts for Pricing Despite Not Trading Them
- Optiver, the Netherlands-based market-making firm, is integrating data from prediction markets to refine the pricing of trades in equities and other traditional asset classes, according to a senior...
- The development was confirmed during the 40th ISDA Annual General Meeting (AGM), which took place from April 28 to April 30, 2026, in Boston.
- The use of prediction markets allows the firm to incorporate crowdsourced forecasts into its valuation process.
Optiver, the Netherlands-based market-making firm, is integrating data from prediction markets to refine the pricing of trades in equities and other traditional asset classes, according to a senior executive at the firm.
The development was confirmed during the 40th ISDA Annual General Meeting (AGM), which took place from April 28 to April 30, 2026, in Boston. While the market-maker does not trade event contracts itself, it leverages the pricing data generated by these markets as an additional input for its core pricing models.
Data-Driven Pricing Strategy
The use of prediction markets allows the firm to incorporate crowdsourced forecasts into its valuation process. Matt MacKenzie, head of US advocacy and regulatory affairs at Optiver, explained the firm’s approach to data acquisition in the context of its primary business objectives.
Our main core business is pricing things accurately, so we’re going to take any number of data points to do thatMatt MacKenzie, head of US advocacy and regulatory affairs at Optiver
By analyzing the implied probabilities found in prediction markets, Optiver can identify sentiment shifts or anticipated outcomes that may not yet be fully reflected in traditional asset prices, thereby improving the accuracy of its quotes in the broader market.
Context of the ISDA AGM 2026
The disclosure occurred amidst a broader industry discussion at the ISDA AGM regarding the revolution
of financial markets. ISDA CEO Scott O’Malia noted in his opening remarks on April 29, 2026, that the industry is facing significant uncertainty, and transformation.
Other themes discussed during the event included the role of artificial intelligence in transforming trading and risk management, as well as the potential for tokenization to increase efficiency in liquidity and collateral workflows. The integration of alternative data sources, such as prediction markets, aligns with this broader trend of firms seeking more granular and real-time data to maintain a competitive edge in high-frequency and market-making environments.