Prediction Market Glossary
Simple explanations of financial and prediction concepts.
Prediction Market
A market where people trade contracts based on the outcomes of future events. Contracts resolve to $1.00 if correct and $0.00 if incorrect.
Market Price
The price of a single contract (expressed in cents, e.g. 32¢). It represents the consensus cost to buy one YES or NO share.
Implied Probability
The probability of occurrence inferred from the contract price. If a YES contract costs 32¢, the market implies a 32% chance that the event will occur.
Bid / Ask Spread
The difference between the highest price a buyer is willing to pay (bid) and the lowest price a seller is willing to accept (ask). A narrow spread indicates active, cheap trading.
Liquidity
The volume of active orders available in the order book. Higher liquidity makes it easier to buy or sell contracts at stable prices without moving the market.
Settlement / Resolution
The process by which the market outcome is determined. Once official data is verified, contracts are closed and payouts are sent.
Weather Station
The specific meteorological sensor (usually managed by NWS or FAA) named in the market rules. Only observations from this sensor are valid for settlement.
Brier Calibration Score
A statistical score measuring forecast accuracy. It assesses how closely our estimated probabilities match the actual rate of occurrences. A score of 0.00 is a perfect score.
Paper Trade
A simulated trade used to track performance without risking real capital. All paper trades on this site use recorded historical prices.