Category · Basics
Basics prediction markets.
Plain-English primers on event contracts, probability prices, and how prediction markets work.
Basics · 10 min read
How event contracts work
Price equals probability. A contract at 40¢ means the market thinks there's a 40% chance. Here's the full mechanic, with a Lakers walk-through.
Updated Aug 6, 2026
Basics · 5 min read
Reading probability prices: a 5-minute primer
Why a price in cents is already a probability — and why you'll never want to convert odds again.
Updated Aug 5, 2026Frequently asked questions
What is an event contract?
- A binary contract that pays $1 if a stated real-world outcome happens and $0 if it does not. The price between 1c and 99c is the market's implied probability.
How do I make money?
- By buying below what you believe the true probability is and either holding to settlement or selling into a higher price after the market moves your way.
What does the price actually mean?
- A 62c contract implies roughly a 62% chance, before fees. Fees and spread mean your break-even is slightly worse than the quoted probability.
Sources
Every figure on this page is checked against primary sources — regulator filings, exchange documentation and official results. Prices and rules change; verify with the operator before trading.
- 1.Customer advisories and investor protection notices — U.S. Commodity Futures Trading Commission
- 2.Designated Contract Markets (DCMs) — U.S. Commodity Futures Trading Commission
- 3.The Commodity Exchange Act & regulations — U.S. Commodity Futures Trading Commission