Wealthsimple Plus500 futures deal opens US contracts to Canadians

Wealthsimple Plus500 futures access will give Canadian retail investors a route to US futures contracts through infrastructure supplied by Plus500, the companies’ announced arrangement said. The deal also expands Plus500’s business-to-business push, using its clearing, order routing and risk management systems for a large Canadian wealth platform.

Plus500 said Wealthsimple serves more than 4 million Canadians and has C$150bn in assets under administration. Under the partnership, Plus500 will provide the technology and regulated futures infrastructure behind the service, rather than Wealthsimple building those systems in-house.

The announcement said Wealthsimple’s clients will receive direct access to US futures contracts through Plus500’s proprietary futures trading platform. Plus500 described the access as a first for Wealthsimple’s Canadian retail investor base.

What does Wealthsimple Plus500 mean for Canadian investors?

For Wealthsimple users, the partnership is intended to add US futures contracts to the range of instruments available through the Canadian platform. Futures are agreements to buy or sell an asset at a set price on a future date, and they are commonly used for hedging, market exposure and trading around expectations for prices or economic data.

Retail access to futures depends on more than a trading screen. Orders must be routed to the relevant market, collateral and margin must be managed, and clearing arrangements must support the contracts after a trade is placed. Plus500 said its role is to supply those functions through systems already used in its regulated US futures operations.

Plus500 said Wealthsimple selected it because it could combine proprietary technology, CFTC-regulated clearing capabilities and operating infrastructure in one service. The Commodity Futures Trading Commission is the US derivatives regulator, overseeing futures and certain other derivatives markets.

Plus500 builds out its B2B futures business

The Wealthsimple agreement adds another institutional partnership to Plus500’s futures infrastructure business. Plus500 cited its appointment as clearing partner for an event-based contracts platform from CME Group and FanDuel, as well as its partnership with Topstep, as part of the same expansion.

Event-based contracts are derivatives tied to the outcome of a defined event, while futures contracts are linked to an underlying market or asset for settlement at a later date. In both cases, a clearing partner helps manage the obligations that arise once trades are executed.

Plus500 said the Wealthsimple deal supports its growing partner ecosystem and that it has additional opportunities in progress. The company did not disclose financial terms of the agreement, a launch date for Wealthsimple clients, or which specific US futures contracts will be offered.

The partnership places a regulated derivatives infrastructure provider behind one of Canada’s largest retail investment platforms by customer count and assets under administration. For Plus500, it further shifts part of its growth story toward providing market plumbing to other financial platforms, alongside its own trading services.

This story draws on original reporting from Finextra Research.