FutureSports, the index provider developing gauges tied to the performances of college and professional athletes and teams, has announced a partnership with Major League Baseball (MLB) to create indexes based on the performances of the league’s 30 franchises.
Under the agreement, MLB will provide official league data to FutureSports, enabling the creation of new CME FutureSports Performance Indexes (FSPI) for each MLB team. Financial details of the deal were not disclosed. CME Group (NASDAQ: CME) and FutureSports announced a partnership in July, and with the addition of the MLB deal, the exchange operator will offer derivatives based on the baseball indexes.
“The agreement paves the way for CME Group to list weekly, monthly and quarterly cash-settled futures contracts, pending regulatory review, based on the CME FSPI MLB benchmarks,” according to a statement issued by FutureSports.
Specific launch dates for the MLB team futures contracts have not been disclosed, but the 2027 season spring training begins on Friday, Feb. 19, as per the league schedule.
ETFs, Of Course
The first set of FSPIs are linked to NHL performance metrics, prompting several exchange-traded fund (ETF) issuers to file for futures-based funds based on each professional hockey team. One issuer even filed plans for leveraged ETFs tied to the NHL FSPIs.
A similar situation is now unfolding following the introduction of MLB indexes. Both LeagueShares and RexShares have filed for ETFs related to the FutureSports MLB indexes. These funds, if approved, would hold portfolios of the CME-traded derivatives. LeagueShares has gone a step further by including a filing for 2x leveraged MLB futures funds.
“Of course there’s already a filing for daily leveraged futures baseball ETFs — which are basically the equivalent of a corked bat with eight holes drilled in the handle that’s been dipped in pine tar,” wrote Ben Johnson, head of client solutions at Morningstar, on X.
As of now, the Securities and Exchange Commission (SEC) has not approved the NHL futures ETFs mentioned.
Not Quite Betting, Not Quite Prediction Markets
For the appropriate audience, likely professional traders and sophisticated retail investors, the CME futures tied to FutureSports indexes could provide unique opportunities as they are not traditional sports bets nor exact replicas of event contracts traded on prediction markets.
The MLB and NHL futures contracts can be used by large-scale bettors to hedge various team exposures throughout the leagues’ seasons.
Regarding the regulatory status of the ETFs, the SEC has not made any public statements regarding the NHL funds, and it is too early to determine the outcome of the MLB filings. However, there are numerous futures-based ETFs currently in the market, indicating that pro sports futures ETFs may not face the same obstacles that have hindered the introduction of other ETFs.