In this guide
What Is a Prediction Market?
Prediction markets are financial platforms where traders exchange contracts tied to future outcomes. Each contract's trading price embodies the aggregate market view of how likely an event is to materialise. PolyGram offers UK users entry to a global range of prediction markets.
How Do Prediction Markets Work?
At their core, prediction market contracts pose a straightforward question: will Event X occur by Date Y? Take this example: "Will Labour secure victory in the forthcoming UK general election?" Two contract types exist for every market:
- YES: Pays $1.00 if Labour wins the election
- NO: Pays $1.00 if Labour fails to win
When YES trades at $0.65, traders collectively assess a 65% chance Labour will prevail. You purchase YES if you believe the odds favour them, or NO if you reckon otherwise. A correct prediction yields profit; an incorrect one costs your investment.
Prediction Markets vs Traditional Betting
- No overround: Traditional bookies embed a profit margin — prediction markets omit this. YES and NO prices together equal roughly $1.00
- You can sell before resolution: Close out your position at any time prior to the event concluding
- Transparent: Market prices and order book activity remain openly visible
- Crowd wisdom: Prices synthesise insights from many thousands of market participants — typically more reliable than polling data
Types of Prediction Markets
Political Markets
Electoral contests, public sentiment measurements, legislative decisions, shifts in leadership. These dominate activity and liquidity on major platforms such as Polymarket.
Sports Markets
Game results, championship victors, individual athlete performance metrics, final standings.
Crypto Markets
BTC price milestones, blockchain improvements, spot ETF launches, government intervention scenarios.
World Event Markets
GDP movements, seismic activity, research breakthroughs, film and music accolades.
Are Prediction Markets Legal in the UK?
The UK regulatory landscape surrounding prediction markets remains ambiguous. The Gambling Commission has neither formally authorised nor formally prohibited them. Operators such as PolyGram function via blockchain-based settlement mechanisms, which operate outside conventional gambling frameworks.
How Accurate Are Prediction Markets?
Empirical studies demonstrate that prediction markets consistently surpass specialist analysts and conventional survey methodologies in forecast accuracy. Polymarket's markets correctly anticipated outcomes across the 2024 US presidential race, numerous contests across Europe, and significant cryptocurrency developments well ahead of official announcements.