Prediction markets are gaining traction among Wall Street professionals who see them as a potentially useful tool for institutional investors, according to new research.
Long viewed as niche venues tied largely to retail speculation, these markets are now drawing attention from market structure specialists looking for alternative ways to gauge future outcomes. Wealth managers have told InvestmentNews that they are already seeing changes in investor behavior due to the growth of prediction markets and sports betting and expect more evolution in 2026.
The new Coalition Greenwich study, conducted in January 2026 among US buy-side and sell-side professionals, analysts and fintech firms, found that 43% of respondents have a favorable view of prediction markets’ role in the financial system.
“It’s easy to understand why exchanges, brokers and investors are intrigued,” said Jesse Forster, head of equity market structure research at Crisil Coalition Greenwich and author of the report. “By tapping into the ‘wisdom of the crowd,’ prediction markets promise unique signals about the future.”
Interest is being fueled in part by the involvement of major exchange operators including CME Group, Cboe and Intercontinental Exchange which have all taken steps toward offering or supporting prediction-market products. ICE, for example, holds an ownership stake in the prediction platform Polymarket. Brokerages including Interactive Brokers and Robinhood are also playing a role by expanding access and infrastructure.
Survey participants pointed to speculative trading and macro hedging as early institutional use cases.
About 60% said data from prediction markets — including prices, implied odds, volume and positioning — could serve as a useful supplement to traditional market indicators. Another 17% believe the information generated could provide hard-to-source insights with the potential to drive alpha.
But skepticism remains and almost 20% of respondents questioned whether prediction markets add meaningful value, citing concerns that they may generate more noise than signal or blur the line between investing and gambling. Limited liquidity and inconsistent participation were also highlighted as obstacles.
“Without depth and participation, markets may not clear efficiently enough to produce reliable signals,” Forster said. “To win institutional trust, prediction markets must demonstrate repeatable, actionable forecasting value rather than entertainment-driven volatility.”
The findings suggest prediction markets are moving closer to the mainstream, but wider adoption will likely depend on whether these platforms can prove their usefulness as reliable, decision-ready tools rather than speculative novelties.
Chicago-based Mesirow Fiduciary Solutions adds flexPATH's plan-level outsourced fiduciary book, boosting its retirement market reach to $164 billion.
Also, Raymond James's employee advisor channel adds breakaways from Wells Fargo and Stifel, while UBS welcomes an ex-Morgan Stanley duo in Indiana.
It promised guaranteed principal and 10% monthly returns. The SEC says it invested nothing.
Ten years after entering the fee-based annuity market, MassMutual Ascend says nearly half its lifetime sales came in the past two years alone – but barriers remain among fee-only advisors.
Amplify, WealthReach, Zeplyn and Zocks have unveiled partnerships aimed at automating portfolio management, content creation, account opening, and client communication.
Northern Trust’s Ken Lassner shows advisors how to convert volatility into after-tax portfolio gains
Dan Biagini of American Equity says the steady decline of pensions, longer lifespans and a reset in interest rates are rewriting how advisors build retirement income
