How it works
Prices are probabilities
A prediction market turns an opinion into a price. If a contract trades at 62¢, the market is saying the thing is about 62% likely. That is the whole idea — everything below is mechanics.
The basic unit
Every market is one yes-or-no question with a deadline. You buy shares of YES or shares of NO. When the question settles, each winning share pays exactly $1.00 and each losing share pays nothing.
So if you buy YES at 62¢ and you are right, you turn 62¢ into $1.00 — a 61% return. If you are wrong, you lose the 62¢. Your maximum loss is always what you paid, never more.
A worked example
You think the Riverwalk breaks ground on time. It is trading at 72¢. You put in $50.
- $50 ÷ $0.72 = 69.4 shares of YES
- It breaks ground: 69.4 × $1.00 = $69.40
- Profit before fees: $19.40
- Fee is 1% of the $19.40 gain = $0.19
- You keep $69.21
If it does not break ground, the 69.4 shares expire worthless and you are out the $50.
Why the price moves
Prices move because people trade. Buying YES pushes the price up; buying NO pushes it down. Large orders move the price more than small ones, and you fill at the average price across your own impact — so you cannot move a thin market and profit from the move itself.
A market that sits at 50¢ is genuinely uncertain. One at 95¢ is nearly settled, and there is little left to win. The interesting markets are the ones where you think the crowd is wrong.
Selling before it settles
You do not have to wait for resolution. If a market moves your way, you can sell your shares back at the current price and take the profit immediately. This is usually how people actually close positions.
Fees
- 1% of net winnings. Charged only when you come out ahead.
- No fee to place a trade. No spread markup, no monthly charge.
- No fee to lose. If you are wrong, you lose your stake and nothing more.
- No fee to withdraw your own money.
How markets resolve
Every market names its source before it opens. Not "news reports" — a specific, checkable public record: a council vote, an IHSA box score, an NWS climate report, a district board minute.
- Trading stops at the listed close time.
- Settlement is posted within 72 hours of the source publishing.
- Winning shares pay $1.00 and land in your cash balance automatically.
- If the source becomes unavailable, or the question turns out to be genuinely ambiguous, the market is voided and every position is refunded at cost. Nobody wins a coin flip on bad wording.
Disputes
If you think a market settled wrong, you have 72 hours to dispute it. A disputed settlement is reviewed against the named source and, if the original call was wrong, reversed and re-paid.
Limits and guardrails
- You set a monthly deposit cap at signup. Lowering it is instant; raising it takes 72 hours.
- There is a maximum position size per market, so one trader cannot corner a thin market.
- You can lock your own account for a fixed period at any time.
Proposing a market
Anyone with an account can propose one. Good proposals read like a contract: a clear subject, an unambiguous threshold, a hard deadline, and one source that settles it. Proposals are rejected if they target a private individual, involve anything illegal, or could be caused by the person proposing them.
New markets need seed liquidity — money you put up so there is something to trade against. It stays in the market until it resolves.
What this is not
This is not a sportsbook. There is no house taking the other side of your bet and no built-in edge against you. You trade against other people, and the price is whatever the two of you agree on. NapBet takes a cut of winnings and otherwise does not care who is right.