TRADING BASICS

       

PredictIt allows you to make predictions on future events by buying shares in the outcome, either Yes or No. Each outcome has a probability between 1 and 99 percent. We convert those probabilities into US cents.

For example, Trader A thinks an event has at least a 60 percent chance of taking place so she offers 60 cents for a Yes share. PredictIt matches her offer with that of Trader B, who is willing to pay 40 cents for a No share. Each trader now owns a share in the market for this event on opposite sides.

The prices of shares will change over time and both traders could decide to sell their shares at any time. A key to success at PredictIt is knowing when to sell in order to take a profit or prevent a loss.

If an event does take place, all Yes shares are redeemed at $1. Shares in No become worthless. If the event does not take place before the market closes, traders holding shares in No will be paid $1, while Yes shares will be worthless.