Susquehanna International Group is soliciting hedging trades on World Cup outcomes and says it can take $500 million worth of exposure to those trades, according to a press release published Wednesday.
The Wall Street giant in market making is believed to be the largest market maker on Kalshi and is also the predominant one on Rothera, which is a joint venture between the business and Robinhood.
Susquehanna said it is open to transactions “for qualified institutional counterparties seeking to hedge or transfer event-driven commercial exposure.” It added that this may include “exposure tied to remaining teams advancing through the knockout stage, winning the tournament, or triggering promotions, marketing campaigns, or other obligations linked to team performance.”
“The World Cup’s return to the United States for the first time in more than three decades has created extraordinary levels of fan engagement, viewership, and commercial activity across the sports ecosystem,” said Ric Best, Susquehanna head of prediction markets. “For sponsors, media and broadcast partners, hospitality providers, consumer brands, and other businesses with exposure tied to tournament outcomes, prediction markets can help manage measurable economic risks associated with teams advancing, winning, or otherwise triggering event-driven obligations.
Best said that promotions around World Cup results could be among the outcomes a business might want to hedge.
“Those risks could include promotions, rebates, giveaways, or other customer incentives that can be impacted by team performance,” he said. “This commitment demonstrates Susquehanna’s belief in prediction markets as an innovative tool for price discovery, hedging, and risk management.”
Some small businesses have hedged promotions based on sports outcomes on Kalshi, though the reported promotions and trades have mostly been small scale. Kalshi often pointed to the hedging trades that have existed as evidence that its sports event contracts meet the definition of a swap in the Commodity Exchange Act and should not be subject to state sports betting laws.
While some businesses can hedge risk on prediction markets by simply placing a bet in a similar manner to ordinary users, some prediction markets such as Kalshi also offer block trades that allow for large trades to be negotiated off-exchange and then recorded on the exchange. In this case, Susquehanna offers direct contact information for hedging inquiries, suggesting that it is looking at block trades.
Susquehanna was reportedly involved in the largest known sports hedging on a prediction market, when Spanish soccer club Osasuna purchased an insurance policy through Game Point Capital that hedged its risk of the club being relegated from La Liga with a bet that the team would be relegated. The club ultimately stayed in La Liga.
