In this guide
What Is a Prediction Market?
Prediction markets are financial venues where traders exchange contracts tied to the results of forthcoming events. The contract's market price embodies the collective assessment of how likely that event is to materialise. PolyGram operates as a UK-based prediction market platform providing exposure to events worldwide.
How Do Prediction Markets Work?
Every prediction market contract poses a straightforward question: will Event X occur before Date Y? Consider this example: "Will the Labour Party secure victory in the forthcoming UK general election?" Two distinct contracts exist for trading:
- YES: Should Labour prevail, this contract settles at $1.00
- NO: Should Labour fail to win, this contract settles at $1.00
When the YES contract trades at $0.65, participants interpret this as a 65% chance of Labour's victory. You might purchase YES if you believe the probability is higher, or NO if you reckon it's lower. Correct predictions yield gains; incorrect ones result in losses on your investment.
Prediction Markets vs Traditional Betting
- No overround: Traditional bookmakers embed a profit margin — prediction markets eliminate this. YES and NO prices together equal roughly $1.00
- You can exit early: Close out your position at any stage before the event concludes
- Full transparency: Market participants can view all pricing information and the order book openly
- Distributed intelligence: Prices synthesise insights from many thousands of market participants — frequently surpassing the accuracy of conventional surveys
Types of Prediction Markets
Political Markets
Electoral contests, public confidence metrics, legislative outcomes, shifts in leadership. These dominate trading activity and liquidity on platforms such as Polymarket.
Sports Markets
Game results, championship victors, individual athlete performance, standings within competitions.
Crypto Markets
Digital asset price milestones, blockchain network improvements, fund product launches, government regulatory announcements.
World Event Markets
Macroeconomic signals, geological events, technological breakthroughs, cultural award ceremonies.
Are Prediction Markets Legal in the UK?
The regulatory standing of prediction markets in the UK 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 under different frameworks than conventional gambling services.
How Accurate Are Prediction Markets?
Empirical evidence demonstrates that prediction markets consistently surpass specialist analysts and conventional polling in forecast accuracy. Polymarket's track record includes successful predictions for the 2024 US presidential election, numerous contests across Europe, and significant cryptocurrency developments—often weeks or months ahead of official results.