Interactive Brokers tests hurricane contracts tied to coastal locations

Precedent & Market Context

Interactive Brokers has offered seasonal and regional hurricane contracts since at least May 2025, including seasonal basin counts and major-landfall contracts introduced in 2025. The live contracts are more granular and immediate, tied to real-time data, and invite comparisons with platforms such as Kalshi and Polymarket.

Main Event

Interactive Brokers is testing a new set of live hurricane contracts on its ForecastEx platform, aimed at helping traders price and hedge storm risk one coastline at a time. The pilot ran on a real storm, Hurricane Isaias, and was the first complete end-to-end test of these contracts on a real storm, running the full cycle of listing, trading and settlement against live weather rather than a simulation.

Analysis & Market Impact

The new contracts are tied to the maximum wind gust speed recorded at a specific coastal location during an Atlantic storm. Traders can pick from wind gust thresholds running from 70 mph to 200 mph, set in 10 mph steps. Contracts only go live once forecasts show a projected 5% chance of gusts topping 70 mph at a given location. The contracts are designed to resolve within days of a storm dissipating, and settle on 3-second gust maxima instead of the 1-minute sustained wind measure traditionally used to describe hurricanes.

Implications & Outlook

Location-specific contracts let players hedge against risk at specific sites. If the bet pays out when gusts at a specific site exceed a set threshold, it can offset losses tied to that same site. Liquidity is a key question, as 25 separate coastal markets per storm could spread trading thin. Relying on Reask for both forecasts and post-storm reconstructions centralizes a lot of trust in one modeling firm's methodology. Using 3-second gusts departs from the measurement most people hear in hurricane coverage.