Open positions earn income for as long as you hold them. The exchange calls this an incentive coupon, and you receive it whichever way your contract eventually resolves.
Where it comes from
Every contract on ForecastEx is fully backed by cash before it's entered. The exchange holds that collateral, invests it, and passes the interest it earns back as a monthly coupon payment. This isn't a promotion or a sign-up bonus that can be withdrawn next quarter — it's written into the exchange's rulebook.
ForecastEx withholds an administrative clearing fee of 50 basis points of the interest earned on that collateral before the coupon reaches your account. Lumina receives no part of the coupon.
How it works
It accrues on the daily settlement value of your open positions — what the contract is worth at that day's close, not the $1.00 it might settle at. A contract closing at 70¢ accrues on 70¢.
It accrues daily and is paid monthly.
Both sides earn it. The Yes holder and the No holder in the same market each accrue coupons on their own positions.
It can never be negative. A coupon adds to your account or is zero; it never subtracts.
The rate is tied to the Effective Federal Funds Rate, published each business day by the Federal Reserve Bank of New York. It isn't fixed at the federal funds rate, and the exchange's rulebook sets a minimum the coupon can't fall below.
What it's worth
Because the coupon rate tracks the federal funds rate, it moves as rates move — and rates move a great deal. The federal funds rate itself was 0.10% on 1 July 2021, 5.33% on 1 July 2024, and 3.63% on 28 July 2026.
To put a number on it: $1,000 of open positions held for a full month accrues roughly $2.50 at a 3% annual rate, or about $4.17 at 5%. Those are illustrations, not a rate you're being quoted — the current rate is shown in the app.
That's small next to what a contract itself pays, and it's meant to be. What it changes is the arithmetic of holding. On a long-dated contract, coupons accumulate month after month, and they arrive regardless of the outcome — a position that resolves against you still earned coupons for its entire life.
Interest on uninvested cash
Cash sitting in your account rather than in a position doesn't earn the incentive coupon — coupons accrue on open positions only. It isn't idle, though. Uninvested cash is held at Interactive Brokers and accrues interest under IBKR's own credit-interest program: daily accrual, paid monthly, with IBKR's minimum balance requirements applying — the same mechanics as for IBKR's direct clients. The rate moves with market interest rates; for the terms that currently apply to your account, contact support.
Tax
Coupon payments may be taxable, as settlement payments may be. They appear in your activity statements and in the tax forms IBKR generates for you: Taxes and documents. Lumina doesn't give tax advice — how any of this applies to you is a question for your own tax adviser.
Related: Fees and costs · How markets resolve and settle