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11 sats \ 4 replies \ @mega_dreamer OP 28 Nov \ parent \ on: 🏀 Will Jarred McCain claim the NBA Rookie of the Year 2024-2025 season? 🌟 Stacker_Sports
I used ChatGPT to clarify how trading (not betting) works in a predictions market:
Great question! Let me break it down for you. In a predictions market, you're not just "betting"; you're essentially trading positions on what you believe the outcome of an event will be. It’s more like buying and selling stocks based on your predictions.

Let’s unpack your “No for everyone” idea:

While it sounds logical—because only one team wins, and the rest are “No”—it’s not that simple in a prediction market. Here’s why:
  1. Market Prices Reflect Probabilities
    Each outcome (Yes or No) is priced based on what traders collectively think its likelihood is. For example:
    • If Team A has a 70% chance of winning, the "Yes" might cost you 70 sats, and the "No" might cost you 30 sats (because probabilities total 100%).
  2. Profit Comes From Buying Low, Selling High
    You can profit if you correctly anticipate changes in the probability. If you think Team A’s chance is higher than the market believes (e.g., you think they’re 90%, but the market says 70%), you could buy "Yes" shares at 70 sats. If the odds shift in your favor (e.g., to 90%), you can sell those shares for a profit.
  3. Diversified Strategies Matter
    Focusing solely on "No" for everyone isn’t necessarily profitable because:
    • If you buy "No" for every team, the collective cost will usually add up to 100%. If all other teams lose, your profit depends on whether the total payout (1 share = 1 sat) exceeds your investment.
    • You’d only profit if the market misprices "No" for one or more teams.
  4. Liquidity and Timing
    • In many prediction markets, you can enter and exit positions before the event resolves. For example, if the odds for Team A winning drop from 70% to 50%, and you’ve bought "No," you can sell your position for a profit even before the game ends.

Why this matters:

Prediction markets reward people who can better estimate probabilities than the collective market. The key to making a profit isn’t about betting on winners or losers; it’s about identifying when the market misprices an outcome.

Quick Example:

Say the market thinks Team A has a 10% chance of winning (10 sats for "Yes"). But you know a key player is back in action, and you believe their real chances are 25%. You buy "Yes" at 10 sats. If others catch on, the price may rise to 25 sats, and you can sell your shares for a 150% profit.
It’s less about “betting” and more about spotting opportunities where the crowd gets it wrong. That’s the beauty of a prediction market!
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120 sats \ 3 replies \ @IamSINGLE 28 Nov
Thank you so much. I'm getting a little understanding of it. Can you pleas tell me what this means
Do I have to pay 75 sats for a No and 25 sats for a yes and winning (as is the odds now) 25 Sats for a no outcome and 75 for a yes outcome? Is it correct?
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11 sats \ 2 replies \ @mega_dreamer OP 28 Nov
Its easier to understand the odds, price and Potential Earn on the market details page.
https://beta.predyx.com/market/lions-win-super-bowl-2025

To explain the odds and price:

If the current odds/probability is 25%:
  • You pay 0.25 sats for each share of YES (price 0.25/share), on Predyx you typically buy 100 shares, so you pay 25 sats for 100 shares.
  • You pay 0.75 sats for each share of NO (price 0.75/share), on Predyx you typically buy 100 shares, so you pay 75 sats for 100 shares.
1 share = 1 sat, thus if you buy 100 shares of any outcome (YES/NO), and your prediction was correct, then you get 100 sats.
For example you buy 100 shares of YES on the above market with 25% Chance/Probability/Odds. That means you paid 25 sats. If Lions win, you make 100 sats.
  • In terms of sports betting your odds are 4.00 (European Odds - decimal) or
  • In terms of finance your ROI is 400%
Let me know if this gives you some idea of how the pricing and shares work. I'll be more than happy to explain in more details if you wish.
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120 sats \ 1 reply \ @IamSINGLE 28 Nov
Thanks for the detailed answer. I think I have understood it well and if not a few sats should make me.
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11 sats \ 0 replies \ @mega_dreamer OP 28 Nov
Yes, please try with small amounts till you get a hang of it. It took me few weeks to understand the prediction market and pricing. And it took me months to fully understand the significance of liquidity and how it impacts the odds/pricing when betting big.
All the best, and Happy Thanksgiving!
Feel free to reach out anytime you have a doubt.
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