Robinhood (HOOD) Stock: Trading Platform Jumps 10% on New Prediction Markets Deal

TLDR

• Robinhood stock jumped over 10% after announcing a deal with Susquehanna International to launch a futures and derivatives exchange focused on prediction markets
• The company will take control of LedgerX alongside Susquehanna, owning a combined 90% stake in the derivatives exchange
• Since launching prediction market services last year, Robinhood has facilitated 9 billion contracts traded by more than 1 million users
• Bernstein estimates the platform could generate over $300 million annually from event contracts and maintains a Buy rating with a $160 price target
• Robinhood shares are up 215% year to date, making it the second-largest gainer on the S&P 500 in 2025

Robinhood stock surged over 10% on Wednesday after the trading platform announced a major expansion of its prediction markets business. The move marks a strategic push into one of the fastest-growing segments in online trading.

Robinhood Markets, Inc., HOOD

The company revealed plans to launch a futures and derivatives exchange in partnership with market maker Susquehanna International. This new venture aims to expand Robinhood’s prediction market offerings where users can bet on outcomes ranging from sports results to Federal Reserve interest rate decisions.

The deal involves a three-party agreement with Miami International Holdings to take control of LedgerX. LedgerX was previously part of the defunct crypto exchange FTX. Robinhood and Susquehanna will own a combined 90% stake in the derivatives exchange while Miami International retains 10%.

The transaction is expected to close in the first quarter of 2026. Susquehanna will serve as a liquidity provider, which is essential for maintaining price stability in trading.

Robinhood first entered the prediction markets space last year through a partnership with Kalshi. The results have been impressive. Since launching the service, 9 billion contracts have been traded by more than 1 million users.

The company now accounts for more than 50% of Kalshi’s market volumes. Bernstein analysts note this gives Robinhood leverage to claim a larger share of market revenue.

Building on Market Dominance

Bernstein analyst Gautam Chhugani and his team maintain a Buy rating on Robinhood with a $160 price target. The firm estimates the platform is on pace to generate more than $300 million from event contracts on an annualized basis.

The analysts believe Robinhood will continue distributing Kalshi products. However, the new exchange will let the company add more event contracts directly. This gives Robinhood more control over its prediction markets business.

Prediction markets have exploded in popularity recently. These markets allow investors to trade contracts predicting future events like presidential elections or Fed rate decisions. Major players in traditional markets have taken notice.

Last month, Intercontinental Exchange invested $2 billion in Polymarket. Polymarket is currently the world’s largest prediction market. The investment signals growing institutional interest in this space.

Strong Year-to-Date Performance

Robinhood shares are up 215% year to date. This makes it the second-largest gainer on the S&P 500 in 2025. The stock was added to the index in September.

The company stated the new exchange will introduce more choices for consumers. It will also provide flexibility to build faster and deliver more contracts and services to traders.

Shares closed at $128.20 on Wednesday. The stock gained an additional 0.47% in after-hours trading to $128.80.

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