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FundamentalsWhat is a prediction contract?FundamentalsDoes 65¢ really mean a 65% chance?Market mechanicsRead the rules before the headlineMarket mechanicsThe price you see is not always the price you getMarket mechanicsCalculate the return, not just the payoutRisk & rulesThe risks a probability chart leaves out

Understand the odds.
Know the rules.

Understand prediction contracts with clear explanations, practical tools, and sources you can check.

Simulated example

Weather · Binary contract

Will the temperature reach 80°F tomorrow?

64¢
Yes contract priceMarket-implied likelihood ≈ 64%
A yes share pays $1 if the event happens, $0 otherwise.
Simulated example, not a live market. Prices are illustrative and exclude fees. A real weather contract also specifies the location, observation date, official source, and treatment of revisions. How contracts settle
  • Primary-source research
  • Plain-language explanations
  • Independent perspective
Our editorial standards

What are prediction contracts?

Prediction contracts, also called event contracts, have payoffs tied to a defined event. A common binary contract pays $1 if your side wins and $0 if it loses. Its price, written rules, and fees determine how it works. Learn the fundamentals

Start wherever your question is.

Three ways in, depending on whether you want the concepts, the venues, or the numbers first.

Read the contract, not just the odds.

A price is only part of the picture. Ask these three questions before every position.

Learn how markets work
01

What exactly counts as “yes”?

Check the event definition, deadline, and resolution source.

02

What will it actually cost?

Look beyond the price to fees, spreads, and liquidity.

03

What could go wrong?

Consider loss, access, custody, and settlement uncertainty.

Stuck on a term?

The glossary explains twenty essential concepts, from implied probability to settlement, in plain language.

Explore the glossary