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Posted December 22, 2025 at 12:52 pm
Last weekend’s volume on ForecastEx totaled 20.39 million as prediction market enthusiasts gravitated to daily high temperature contracts across US cities as well instruments connected to the prices of the Bitcoin and Solana cryptocurrencies. Today’s 2.2 million contracts that have traded so far additionally feature the price of Ethereum and futures tied to the S&P 500 and Nasdaq 100 indices on the list of 10k contracts or more being traded. Below, I share high-conviction forecast trade ideas that expire tomorrow related to industrial production, corporate profits and the Baltic Dry Index.
The low result from October 2024 and the associated expected increase in tomorrow’s industrial production print signal a heavy likelihood that the publication will arrive north of 1%. Indeed, the favorable annualized base effect, September’s reading of 1.6% and the median estimate of 2.1% year over year point to a mispricing, in my view. I believe the “Yes” at 1% should cost more than $0.70, but it’s only at $0.26 and is significantly undervalued, in my opinion. Additionally, the “Yeses” at 0.5%, 0%, -0.5% and -1% are appealing; they’re going for $0.52, $0.70, $0.83 and $0.93.
Corporate profits tend to loosely track gross domestic product (GDP) in the directional sense, meaning that earnings and the economy generally move north or south together. Tomorrow’s expectation of 3.2% for third-quarter GDP effectively means that corporate profits are very likely to be positive. For that reason, I find the “Yeses” that are in negative territory attractive from a risk-reward standpoint. The “Yeses” ranging from -1.2% down to -7.2% are costing between $0.59 and $0.95 and offer wide paths for capital appreciation in my opinion.
Lower oil prices are likely to sustain the recent downward trend in the Baltic Dry Index, which is why I find the “Nos” from 2,150 and higher attractive. The six thresholds ranging from 2,150 up to 2,650 are spanning from $0.72 to $0.94 in cost, while the underlying is currently at 2,023. I think there’s a low probability that the gauge jumps to 2,150 or higher by tomorrow morning. But conversely, there’s also a low chance that it drops to 1,700 or below, and I find the “Yeses” at 1,700 and 1,550 attractive; they’re going for $0.90 and $0.94.
Source for images: ForecastEx
Note: Prices are highest bids as of the morning of Dec. 22, 2025. Red circles around the thresholds were inserted by J. Torres to highlight Yes” and “No” answers throughout different levels.
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This material is from IBKR Macroeconomics, an affiliate of Interactive Brokers LLC, and is being posted with its permission. The views expressed in this material are solely those of the author and/or IBKR Macroeconomics and Interactive Brokers is not endorsing or recommending any investment or trading discussed in the material. This material is not and should not be construed as an offer to buy or sell any security. It should not be construed as research or investment advice or a recommendation to buy, sell or hold any security or commodity. This material does not and is not intended to take into account the particular financial conditions, investment objectives or requirements of individual customers. Before acting on this material, you should consider whether it is suitable for your particular circumstances and, as necessary, seek professional advice.
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