NEW YORK: A commercial market for political futures where traders can hedge and speculate on political risk based on ongoing legislative changes launched last Friday. Although the American Civics Exchange is operating with “play money” until the full launch in mid-to-late April, the group has undertaken a communications plan to spur high-net worth investors to place their money in the online trading platform.
The exchange, which targets individuals, institutions, and others with millions of dollars to invest, will focus its outreach effort on word of mouth and media relations, according to Brett Joshpe, chief regulatory officer and general counsel for the Exchange. Executives from the new exchange are also leveraging their network of financial and political contacts on blogs and other news sites, to build buzz in the media.
In addition, it is working with Alexandria, VA-based PR firm Advocacy Ink on media outreach targeting financial and political media, and the business regulatory community. The Exchange is also using Facebook, Twitter, and other social media to promote the launch online.
“With the new [presidential] administration and all the talk about possible [regulation], these things can have huge implications from a bottom-line perspective,” said Joshpe. “We want to build a very robust marketplace where there's a good amount of liquidity and volume, and people who have a vested stake in this are using it properly as a mechanism for offsetting their political risk.”
He also noted that explaining the new market might present some challenges.
“The one thing we always have to be wary of is accuracy,” said Joshpe. “This is designed to be a hedging mechanism. This is not a quirky gambling mechanism.”