Episode summary
Jeremy Maletz | Money Stuff: The Podcast
Money Stuff The Podcast
· · Hosts: Matt Levine, Katie Greifeld · Guests: Jeremy Maletz
Summary
Jeremy Maletz says Susquehanna’s prediction markets business grew out of macro trading, especially election-related work, and now spans flow market making, exchange-listed contracts, and bespoke institutional hedges. He argues that the flow side and the parlay-like products are mostly the same kind of automated, screen-based pricing business, while the institutional book is different because Susquehanna is often underwriting unique risks rather than simply balancing order flow.
The clearest example is the goat-herder hedge, where a California regulatory risk was turned into a $500,000 contract that printed on Kalshi. Maletz says the firm priced it by canvassing goat herders, lobbyists, and internal political research, then worked collaboratively with Kalshi and the customer to shape a contract that actually covered the risk. He emphasizes that the goal was not to win on contract terms, but to make a product that could scale and build credibility.
He also sees prediction markets as a future hedge layer for businesses exposed to policy and credit-like risks, especially data centers, moratoriums, and tenant bankruptcy around major AI infrastructure. For now, he says the institutional book is small and mostly hedging rather than alpha-seeking, but he expects growth to come from more liquidity, better margining, and eventually portfolio-style risk management.
Key takeaways
- Jeremy Maletz says the prediction markets business at Susquehanna started from macro and election trading, then expanded into sports, which still makes up more than half of volume.
- He says the goat-herder contract was priced by canvassing goat herders, lobbyists, and internal research because there was no pre-existing market price to lean on.
- Maletz says the institutional book is still mostly hedging, with the majority of those trades designed to cover real-world risks rather than express alpha.
- He argues that data-center moratorium risk and tenant bankruptcy tied to AI infrastructure are the biggest emerging opportunities for prediction-market hedging.
- He expects prediction markets to become more useful as liquidity, margining, and portfolio-style hedging improve over time.
Notable quotes
“the prediction markets kind of grew out of that because as head of macro, we had quite a bit of focus around elections during election years”
“The block business that institutional business is meaningfully different and I do believe that's the next phase and it's where a lot of my personal time is going into now”
“We basically canvased as much information as we possibly could to come up with an opinion on what we thought the fair probability was”
“our goal is just to figure out how to take the risk. We're kind of execution platform agnostic”
“I do honestly think it needs to be if it's going to become what it needs to become”
How the episode opens
Bloomberg Audio Studios podcasts radio news. Hello and welcome to the money stuff podcast. I'm Matt Lavine. I write the money stuff column from Bloomberg opinion. And today we have a guest who's Jeremy Malletz who is the head of goat markets at Susuana International Group.
You could say that generally goes a little better on business cards if you say head of prediction markets but markets works too. I've been head of macro for a long time at Susuana. Okay. — And in a lot of ways, the prediction markets kind of grew out of that because as head of macro,
We had quite a bit of focus around elections during election years. — We got involved in trading the election over in Europe where you could trade. They have prediction market style contracts on say bet fair and we would also use some of the products that exist say like predicted even if you can't trade on it forformational purposes. So
I'd known about it for a long time. The macro kind of transitioned into
The prediction markets and which started out as a side project and now as you know a very large business for us. My model is that like there are all these prop trading firms that like had 23-year-old interns who got into crypto as a hobby and then that became like their crypto business. And it might be natural to assume that many prop trading firms also get into prediction markets as a hobby because of sports betting.
Is there any of that at Suana or is it strictly like oh it's election markets? So when we first started the prediction market journey, sports weren't a part of predictions in that way.
But that being said, there's quite a lot of overlap and there are certainly a lot of people that are passionate about sports, myself included, the other head of prediction markets, we really got to know each other through sports.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- prediction markets
- hedging risk
- flow vs bespoke trading
- election factor hedging
- adverse selection and correlation
Companies and tickers mentioned
- Susquehanna International Group
Watch the episode
Watch “Jeremy Maletz | Money Stuff: The Podcast” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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