Welcome to PM Academy
Module 01 · Fundamentals · ~12 min
Prediction markets 101.
By the end of this module, you’ll read prices on Limitless the way a professional bettor reads odds, as probabilities you can agree or disagree with, not numbers you have to take a leap of faith on.
Stop guessing. Start trading probabilities. Discover the only global market where information is the primary asset.
How do you read a prediction market price?
A prediction market price is a probability: a YES share at $0.55 means the market sees a 55% chance the event happens, and prices are bounded between $0.00 and $1.00. Every contract settles binary, $1.00 if the event resolves YES, $0.00 if it resolves NO, with no partial credit, so your profit per share is $1.00 minus your entry and your maximum loss is the price you paid. YES and NO prices always sum to $1.00. You enter with one of two order types: a market order takes whatever the book offers right now (instant fill, possible slippage), while a limit order names your price and waits in the book (better price, no guaranteed fill). When you see 67¢ on a Limitless contract, that’s the market saying “this happens 67% of the time”, and your job is deciding whether your read disagrees enough to take the other side.
Section 01
Reading the matrix.
Probability as currency
In traditional finance, stock prices reflect company value. In prediction markets, price is a direct mathematical representation of consensus probability.
Bounded range
Prices are strictly fixed between $0.00 and $1.00.
Direct translation
A $0.55 price means the market sees a 55% chance.
Market sentiment
50%
Share price
$0.50
Buy at $0.50 → Profit 50¢ per share (if wrong, you lose the full 50¢)
Section 02
Settlement logic.
Markets are binary. Upon resolution, shares transform from probabilistic assets into absolute values: $1.00 or $0.00. There’s no partial credit, no settling at 60%, only the two outcomes. Your $0.55 share is worth either a dollar or zero, decided by an external resolution source. The probability was the price; the settlement is binary.
Event resolves YES
Event resolves NO
Section 03
Order execution.
Two ways to enter a position, each with a different tradeoff between speed and price. Market orders take whatever the order book offers right now, instant fill, but the price you get is whatever bids and asks are currently sitting there. Limit orders specify the exact price you’ll accept and wait until someone matches it, better price, but no guarantee of fill. Pick the one that matches what you’re optimizing for.
Market: immediate action
Market orders prioritize speed. You accept whatever price is currently available in the order book to ensure instant execution.
Instant fill
Price slippage
Prediction markets 101: what people ask
Each answer also ships invisibly as schema.org FAQ data for search engines and AI assistants. Tap a question to expand.
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What does a $0.62 price mean on a prediction market?
The market is pricing a 62% chance the event happens. Buy YES at $0.62 and you make 38¢ per share if it resolves YES; you lose the full 62¢ if it resolves NO. Price translates directly to probability because every contract pays exactly $1.00 or $0.00 at settlement, so you can size a position against any number you disagree with. -
What happens when a prediction market settles?
Shares stop being probabilistic assets and become absolute values: the winning side pays $1.00 per share, the losing side pays $0.00. There is no partial credit and no settling at 60%. An external resolution source decides the outcome. The probability was the price; the settlement is binary. -
Should you use a market order or a limit order?
Pick the one that matches what you’re optimizing for. A market order prioritizes speed: you accept whatever price the order book currently offers for an instant fill, with price slippage as the risk. A limit order prioritizes price: you specify the exact price you’ll accept and the order waits in the book until someone agrees, your price or better, but it may never fill. -
Do YES and NO prices always add up to $1.00?
Yes. In a binary market the two sides always sum to $1.00 because exactly one of them will pay $1.00 at settlement: a 55% YES implies a 45% NO. When the event resolves, the winning side’s shares are worth $1.00 and the losing side’s are worth $0.00, never anything in between. -
What is the most you can lose on a prediction market trade?
The price you paid, nothing more. Every contract resolves to exactly $1.00 or $0.00, so a share bought at $0.50 either pays out a dollar or expires worthless; the most you can lose per share is the 50¢ entry. Sizing the dollar amount you commit is therefore the loss control you set at entry.
Section 04
Module checklist.
Tick each item once you’ve actually done it. The Continue button unlocks at 5/5.
Understand binary settlement: contracts pay $1.00 or $0.00.
Know that market price = implied probability.
YES + NO prices always sum to $1.00.
Can calculate dollar profit and loss per share from any entry price.
Know the difference between market and limit orders.
Module 01 complete
Probability priced.
You no longer have to guess what a price means. When you see 67¢ on a contract, you’ll know that’s the market saying “this happens 67% of the time”, and you’ll know whether your read disagrees enough to take the other side.
Concretely, you’ve mastered the foundational pillars of prediction markets, how probability translates to price, and how binary settlement resolves every contract. Three things you walk away with:
A mental model for reading any Limitless price: $0.62 means the market sees a 62% chance, and you can size a position against it.
The ability to pick between a market order (speed, accepts slippage) and a limit order (price control, waits in the book) based on what the trade actually needs.
A clear read on binary settlement: every contract resolves to exactly $1.00 or $0.00, so your max loss is the price you paid and nothing more.
Next up: leverage, how a $0.20 share can deliver a 5x payoff, and how the same math turns into a 100% loss when the resolution lands the other way.
Complete the checklist above to unlock