Glossary

A working glossary of every term you need to read, trade, or talk about prediction markets — from YES share to CFTC to UMA oracle.

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Glossary

Fee

The platform's cut on a trade, withdrawal, or settlement. Eats into edge — calculate before sizing positions.

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Glossary

Share

Common shorthand for one prediction-market contract. Pays $1 if your side wins, $0 if not.

Glossary

Contract

A single tradable unit on a prediction-market exchange — usually one YES or NO share with a $1 max payout.

Glossary

Resolver

A party (usually on decentralized venues) that proposes the outcome of a market, subject to dispute.

Glossary

Order book

The list of all resting limit orders on both sides of a market, organized by price.

Glossary

Market maker

A trader or firm that continuously posts both bids and asks, earning the spread in exchange for providing liquidity.

Glossary

Whale

A trader with enough capital to single-handedly move a market's price.

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Sharp

A consistently profitable trader. Their orders are often the ones moving market prices closer to truth.

Glossary

Vig (vigorish)

The implicit edge a venue or counterparty extracts, usually via spread or fees. The reason 'efficient' markets still have costs.

Glossary

Hedge

An offsetting trade taken to reduce exposure to an existing position.

Glossary

Arbitrage

A trade that locks in profit by exploiting price differences between equivalent markets.

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Basis

The cost-per-share you originally paid for a position — used to compute realized profit at settlement.

Glossary

P&L

Profit and Loss — the running total of what you've made or lost, both realized (closed trades) and unrealized (open positions).