Managing Team-Related Business Exposure
Hedging NHL Sponsorship & Business Exposure
Sponsorship rights, media commitments and long-term partnerships may be established before anyone knows how a team will perform.
CME FSPI NHL Team Index Futures introduce a potential risk-management tool for businesses whose economic exposure may be affected by the performance of an individual NHL team.
The Exposure
The commitment may be fixed.
Sponsorship rights and media budgets may be committed in advance and can extend across multiple seasons.
The realized value can change.
Team performance, playoff participation, attendance, viewership and fan engagement may affect the value ultimately generated by that commitment.
Sponsorship Exposure
When the Cost Is Fixed but
the Outcome Isn't
Sponsorship rights, media commitments and long-term partnerships may be established before anyone knows how a team will perform.
CME FSPI NHL Team Index Futures introduce a potential risk-management tool for businesses whose economic exposure may be affected by the performance of an individual NHL team.
Commitment
Rights fees, advertising budgets and partnership costs may be established in advance.
Uncertainty
Team performance, playoff participation and fan interest remain uncertain when the commitment is made.
Exposure
The value ultimately received from the investment may rise or fall while the original cost remains fixed.
Potential Applications
What Types of Sponsorships May Have
Team-Performance Exposure?
The relationship between team performance and business value varies by sponsorship type. Some arrangements may have more direct exposure than others.
Team & Arena
Jersey and Arena Sponsorships
Value may be influenced by broadcast visibility, in-arena attendance and overall fan engagement.
Potential weak-season effect
Fewer high-profile games and softer attendance may reduce the exposure generated by the sponsorship.
Long-Term
Naming Rights & Partnerships
Multi-year arrangements can create a fixed financial commitment while the team's profile changes over time.
Potential weak-season effect
Partnership costs remain fixed even if team visibility or fan interest declines during the term.
Media
Advertising & Media Buys
The value of team-related advertising may depend on audiences around broadcasts and postseason participation.
Potential weak-season effect
Lower viewership or fewer postseason games may reduce audience exposure while committed media spending remains.
The Hedge
How Could NHL Team Index Futures
Be Used as a Hedge?
A business with exposure to weaker team performance could potentially establish
a short position in futures based on that team's index.
If team performance weakens and the relevant futures price declines, gains on the short futures position
may help offset some of the economic impact associated with the business exposure.
Hypothetical Example
A Sponsor Has Exposure to a
Team Missing the Playoffs
Assume a sponsor believes the value of its media investment would decline if the team underperforms.
Short Futures
The sponsor could sell futures based on the team's index
as part of a potential hedging strategy.
Two Possible Outcomes
Team Underperforms
Sponsorship value may be lower than planned. A short futures position may gain value if the relevant futures price declines.
Team Outperforms
Sponsorship value may benefit from greater visibility and engagement. A short futures position may lose value if the relevant futures price rises.
Risk Management
A Hedge Is Designed to Reduce Exposure, Not Eliminate Risk
The objective of a hedge is not necessarily to generate an additional return. It is to potentially reduce the range of financial outcomes associated with an existing exposure.
A futures hedge and the underlying sponsorship or business exposure may not move together. The hedge can lose money, and it may offset only a portion of a decline in the value of the underlying business arrangement.
Position size, contract selection and hedge duration should reflect the specific exposure being managed.
Matching the Exposure
Different Exposures May
Require Different Approaches
Seasonal
Team & Arena Sponsorship
Exposure
Value tied to a season's team performance, attendance and fan engagement.
Potential approach
Contracts covering relevant months of the season may be considered when constructing a hedge.
Multi-Year
Naming Rights & Partnerships
Exposure
A long-term fixed commitment while team performance changes from season to season.
Potential approach
A business may evaluate its exposure season by season and consider rolling futures positions as appropriate.
Shorter Duration
Media & Advertising
Exposure
Spending tied to audiences around specific periods, broadcasts or postseason participation.
Potential approach
Micro Weekly contracts may allow a hedge to be more closely aligned with shorter periods of exposure.
Evaluating a Hedge
Start With the Business Exposure
Before considering a futures position, the first step is understanding the
financial exposure the business is trying to manage.
Map the Exposure
Identify the sponsorship, advertising or partnership commitment and determine how weaker team performance could affect its value.
Estimate the Risk
Determine how much economic value could reasonably be affected and over what period.
Evaluate the Contract
Consider Standard, Micro or Micro Weekly contracts and expirations that correspond to the exposure.
Monitor the Hedge
Review both the business exposure and futures position as the season and underlying conditions change.
Learn More
Explore NHL Team Index Futures
NHL Team Index Futures
Explore the contracts and the new futures market based on professional hockey team performance.
How NHL Futures Work
Learn how official team statistics affect the underlying indexes and compare Standard and Micro contracts.
What Active Traders Should Know
Read our introduction to CME FSPI NHL Team Index Futures and the mechanics of this new futures market.
Commercial Hedging
Have Business Exposure Tied to
Team Performance?
Businesses considering NHL Team Index Futures as a potential hedging tool should
evaluate the relationship between their specific economic exposure and the futures
contracts before establishing a position.
CME FSPI NHL Team Index Futures are scheduled to begin trading September 28, 2026, pending regulatory review. Product specifications and availability are subject to change.
Futures trading involves substantial risk of loss and is not suitable for all investors. Losses may exceed the initial amount deposited.
Hedging can reduce certain exposures but does not eliminate risk. A futures position and the underlying business exposure may not move together, and a hedge may result in losses.
Examples are hypothetical and provided for educational purposes only. They are not forecasts, recommendations or guarantees of future results.
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