In this guide
What Is a Prediction Market?
Prediction markets represent a category of financial exchange where traders buy and sell contracts tied to the likelihood of specific future occurrences. The quoted price of any given contract embodies the aggregate probability assessment held by all market participants regarding whether that event will materialise. PolyGram operates as a UK-based prediction market platform offering exposure to a worldwide range of events.
How Do Prediction Markets Work?
At their core, prediction market contracts pose a straightforward question: will Occurrence X materialise before Deadline Y? Consider this scenario: "Will the Conservative Party secure victory in the forthcoming UK general election?" Two distinct contract types exist for trading:
- YES: Pays $1.00 should the Conservative Party prevail
- NO: Pays $1.00 should the Conservative Party fail to prevail
When the YES contract trades at $0.65, this signals the market perceives a 65% likelihood of Conservative victory. You may purchase YES if you believe the probability is higher, or NO if you reckon it's lower. Accuracy yields profit; miscalculation results in capital loss.
Prediction Markets vs Traditional Betting
- Absence of overround: Traditional bookmakers embed a profit margin — prediction markets eliminate this. The combined value of YES and NO approaches $1.00
- Early exit capability: You retain the option to liquidate your position at any point before final settlement
- Full transparency: Market participants enjoy unrestricted access to pricing information and order-book activity
- Distributed intelligence: Market valuations synthesise insights from a vast network of independent traders — frequently surpassing the precision of conventional polling methodologies
Types of Prediction Markets
Political Markets
Electoral contests, public confidence indices, legislative outcomes, governmental transitions. Platforms such as Polymarket showcase these as the highest-volume and most actively traded category.
Sports Markets
Game results, championship victors, individual performance metrics, divisional rankings.
Crypto Markets
Digital asset valuation milestones, blockchain infrastructure changes, investment product authorisations, compliance developments.
World Event Markets
Labour statistics, meteorological phenomena, technological breakthroughs, cultural accolades.
Are Prediction Markets Legal in the UK?
The regulatory standing of prediction markets within the UK occupies uncertain territory. No explicit authorisation framework exists through the Gambling Commission, yet neither do comprehensive prohibitions. Operators including PolyGram function via distributed ledger infrastructure, distinguishing their model from conventional gaming enterprises.
How Accurate Are Prediction Markets?
Empirical evidence demonstrates that prediction markets consistently deliver superior forecasting performance relative to institutional analysts and statistical polling. Polymarket's track record encompasses successful predictions of the 2024 American presidential election, numerous contests across the European continent, and significant cryptocurrency developments, often with months of advance accuracy.