Your First Week Watching Prediction Markets
A seven-day routine for learning to read prediction markets properly, without putting money at risk and without drowning in numbers you cannot yet interpret.
The fastest way to get good at reading prediction markets is to spend a week reading them without trading. Here is a structure that works, one habit per day, each building on the last.
Day one: pick five markets and read their rules
Choose five markets across different categories — one economic release, one policy decision, one sporting event, one company or technology milestone, one long-horizon question. Do not look at the prices yet.
Read each resolution rule properly. Write down, in your own words, what has to be true for each to pay out, what source decides, and on what date. If you cannot write it in one sentence, read it again.
This is the single most valuable hour in the whole week. Resolution, explained is the companion guide.
Day two: write down your own estimates
For the same five markets, write down your probability. A number, not a feeling. "Probably" is not an estimate; 65% is.
You will find this uncomfortable, which is the point. Being forced to commit to a number exposes how vague most opinions are. Start from a base rate wherever one exists — how often has this kind of thing happened before? — and adjust from there.
Now look at the prices. Where you disagree by more than ten points, work out why. Usually it is one of three things: you know something the market has not priced, the market knows something you do not, or you misread the rule.
Day three: learn the arithmetic
Convert every price you see into a probability and back. Add Yes and No together and check they sum near a dollar. Work out what the spread costs as a percentage of the potential gain.
Then take one market and compute what a round trip would cost: buy at the offer, sell at the bid, subtract fees. On a market with a two-cent spread and a position bought at 50, you are down about 4% before anything happens. That number should follow you around for the rest of the week.
Turning a price into a probability and the spread is a cost cover the mechanics.
Day four: read the books
Open the order book on a liquid market and on a thin one. Note the size resting at each level. Work out what it would cost to buy 100 contracts, then 1,000, on each.
You will discover that the headline price is roughly honest on the first and almost fictional on the second. That intuition — that a price is only as real as the depth behind it — is the thing that separates people who read market data usefully from people who quote it. Depth, slippage and the price you actually get has the arithmetic.
Day five: watch something move
Pick a market with a scheduled event — a data release, a decision, a result — and watch it through the event. Note the spread before, during and after. Note how fast the price adjusts and whether it overshoots and comes back.
You will see market makers widen and withdraw, you will see the price gap rather than slide, and you will see the first trades after the news set a level that the next hour argues about. Twenty minutes of this teaches more about microstructure than any amount of reading.
Day six: compare two venues
Find the same event priced on both Kalshi and Polymarket. The gap board will find them for you. Read both rules side by side.
Ask whether the gap is a real disagreement or an artefact. Do the two contracts settle on the same source? The same date? Is one quote stale? Is one venue's market thin? By the time you have answered those four questions, you will understand why this site grades every match for equivalence rather than just subtracting one price from the other. What a cross-market gap is actually worth is the guide.
Day seven: score yourself
Go back to the estimates you wrote on day two. Any that have resolved, mark. For the rest, write down what you now think and why it changed.
The goal is not to be right. It is to find out whether your 70% estimates happen about seven times in ten, which takes dozens of forecasts before it means anything. Start the count now. Keeping a forecast journal that is worth reading covers what to record and what to ignore.
What to do in week two
Repeat with ten markets instead of five, and add one habit: before you look at any price, write your estimate. The discipline of estimating first is the whole skill, and it degrades the moment you let the market anchor you.
If you want a daily prompt, the morning briefing publishes one data-backed summary each weekday of what moved overnight and where the venues disagree. It is a reasonable substitute for picking markets at random.
What not to do in your first week
Do not trade the long tail because the numbers look cheap. Do not treat a market that moved a lot as a market that told you something. Do not quote a probability from a market with no volume. And do not conclude the market was wrong because a 20% outcome happened — that is what 20% means.
Educational content only. Nothing here is financial advice, a solicitation, or an offer to trade. Prediction markets can move against you and a position can lose its entire value. Where this guide describes a difference between venues it describes a theoretical cross-market edge in observed prices, which is not a profit: fees, spreads, capital lockup, transfer time and differing settlement rules all come out of it first.
Keep reading
Prediction Market Basics · 4 min readA Short History of Prediction MarketsFrom nineteenth-century election betting on Wall Street to regulated event exchanges and on-chain venues, with the research that made the idea respectable.
Prediction Market Basics · 3 min readResolution: How a Market Decides Who Was RightResolution is where more money is lost than in forecasting. What a resolution source is, how disputes work, and the rule wording that catches people out.
Prediction Market Basics · 3 min readWho Is on the Other Side of Your TradeSomebody took the opposite view, or was paid to be indifferent. Knowing which one you are dealing with changes how you read a price and a spread.
Data and Automation · 3 min readAlerting on Price Moves Without Generating NoiseAn alert that fires constantly is ignored, which makes it worse than no alert. How to define a threshold that reflects significance rather than movement.