How to read a prediction market price

A prediction market contract pays exactly $1 if the thing happens and $0 if it does not. So the price is the probability, in cents, and that is the whole trick — a contract at 63c is the market saying "about 63%".

Converting to odds you already know

Decimal odds are 1 / price. American odds follow from there. The useful direction is usually the reverse: whenever you see a sportsbook price, convert it to a percentage so you can compare it to your own number without doing mental gymnastics.

Both sides always cost $1

If YES is 63c, NO is 37c. Buying NO at 37c is exactly the same position as selling YES at 63c — there is no separate "lay" mechanic to learn. This is also why you can leave a position early: if the price moves to 75c, you can sell your 63c contracts and bank the 12c without waiting for resolution.

The four things the price is not telling you

1. 1The spread. "63c" is usually mid. You buy at the ask and sell at the bid, and on a thin market those can be several cents apart. The mid is not a price you can get.
2. 2The depth. There might be $200 at the ask and nothing behind it. Your fill on $5,000 is a different, worse number.
3. 3The resolution rules. Two markets with near-identical titles can settle on different sources, dates or definitions. The rules are the contract; the title is marketing.
4. 4Time. A market at 63c resolving tomorrow and one at 63c resolving in eight months are wildly different bets, because your money is tied up for the whole period and anything can happen in it.

Reading the chart

Price history on these markets is genuinely informative, because every move is somebody putting money behind a change of mind. A sharp step usually means news; a slow drift usually means positioning. What it is not is a technical-analysis chart — there is no momentum to trade here, only a probability that updates. If you cannot name the event that moved it, you have not learned anything from the shape.