00:00 Speaker A
So, Calshi and Polymarket, the I believe the most of the stuff going on there is sports. It’s very popular. And you can bet on like anything throughout the game. I mean, it’s wild, right?
00:10 Speaker B
Mhm.
00:11 Speaker A
Why do this? Like, how is this different or competing from just betting on the on the team or will so and so score a go a goal, cuz you can already do that.
00:24 Speaker B
A bet is binary, so a win or a loss. Our indexes calculate throughout the games, throughout the season, and they calculate whether there’s a trade on it or not.
00:40 Speaker C
So aside from these being used as a basis for an ETF, what are other use cases for these indexes? How do you see them being applied?
00:50 Speaker B
It’s a benchmark, so it’s a reference, and journalists, sponsors, analysts now have a number to refer to for sports performance and the businesses whose revenues are tied to the sports performance can now transfer their risk. And they can also act as a diversifier because what happens on the field or the ice is a lot different than what happens in the market.
01:21 Speaker C
Mm.
01:21 Speaker A
Have you backtested these? Like, let’s say you go to the beginning of the season, let’s take last season in, um, I’m going to go NFL. I know you don’t have those, but like is everybody started at like 100, then like the Jets go there, right? And then the Seahawks go here. And what would the performance be? Is it like plus 50, minus 50 or 10, 10? Like, how big is the dispersion?
01:46 Speaker B
So the indexes start at 7500 and the winning teams generally end up in the 11,000 to 14,000 points range and the losing teams generally end up in the two to 5,000 range and the teams in the middle end up sort of near 7500 and on average we get point moves of about 50 in a game.
02:18 Speaker C
What kind of feedback have you gotten from, as you mentioned, teams or um advertisers or partners uh about these indexes and how they plan to use it or how they’re thinking about it.
02:35 Speaker B
They’re excited because for the first time there’s now a reference that they can use to transfer their risk. So they really haven’t been able to do that until now.
02:51 Speaker A
I feel like they’re going to they should launch short versions so you can hedge your own
02:55 Speaker C
Well, if you love the Jets for instance, you could short the team. Yeah, and then you get an emotional victory versus financial victory, right?
02:57 Speaker A
like your own Jets. Yeah. Just buy the inverse Jets. And then if they lose at least you get money. Yeah. I I think that could be something interesting because they’ve have each league has four different ETFs that they’ve filed, including a 2X version. I haven’t seen an inverse yet.
03:16 Speaker C
With 2X version, really?
03:17 Speaker A
Yeah. So, and you can double your fun, but I think these will get approved because they’re tracking futures on CME. That’s tech that traditionally, if you’re tracking futures, you get approved. So I I think these will come out at some point. What other leagues could we see? I know you did NHL, those seem to be the first out, and then MLB signed a deal. Could we see NBA or NFL? One quick thing, there was an issue where they put out um it was like Philadelphia Men’s basketball team ETF. I think they were waiting for a deal to put like the Sixers in there. So I think they place holder it just in case you did a deal. So…
03:48 Speaker C
Oh, I see.
03:49 Speaker A
Like a generic name. Yeah, could we are we going to see a lot of other leagues basically?
04:06 Speaker B
Right now, it’s just hockey and baseball. I think what’s coming in the future is for the founders, but I would say that all the ETF filings are public. So I know that the ETFs are planning on holding the futures. We reference the future, the indices under the futures. I speak to that, but I as far as the approvals go, I think that uh between the SEC and the issuers, they’ve seen other ETFs um approved on futures before.
04:47 Speaker C
Sounds like a yes to me.
04:48 Speaker A
Yeah, I don’t think these are the these are not the funds that the SEC is pausing on. Those are the prediction markets. I believe these are straightforward. Like I said,
04:56 Speaker C
These are kind of vanilla like you said, if they’re based on future.
04:57 Speaker A
You should see them out in a couple months. That’s my guess.
