Prediction market prices resemble probabilities, but fees, spread, liquidity, and settlement rules can move the true break-even point.
Last reviewed: 2026-08-10
Calculate effective cost
Add explicit fees to the contract price and consider the bid-ask spread. Effective cost divided by settlement value provides an approximate break-even probability.
Use an independent probability
Compare effective cost with a documented forecast rather than assuming the displayed price is automatically fair.
Read the contract rules
Settlement wording determines what counts as Yes or No. A strong numerical edge is meaningless when the modeled event differs from the venue's resolution criteria.
Respect jurisdiction and access
Venue availability and contract legality vary by location. This site provides manual educational calculations and does not facilitate trades or bypass access restrictions.
Step-by-step workflow
- 1Enter contract cost and fees.
- 2Confirm settlement value and resolution criteria.
- 3Enter an independent probability estimate.
- 4Compare EV with maximum loss and liquidity constraints.
Frequently asked questions
Is market price always a probability?
It is a useful signal, but fees, spread, liquidity, and market behavior can prevent a one-to-one interpretation.
Does this site connect to a venue?
No. The calculator uses manual inputs and does not execute transactions.