How do I check whether a prediction market will resolve the way I expect?
Before you size a trade or attempt an arbitrage, you need to confirm that the market question, official source, cutoff time, timezone, and void rules all match your interpretation. If any of those are unclear, the contract may be riskier than the price suggests.
- Best for
- Resolution review before size or arbitrage
- Primary output
- Readiness score with blockers and warnings
- Use before
- Any market with ambiguous wording or multiple venues
Read the result well
- Flags blockers before execution
- Useful for both single-venue and cross-venue trades
- Creates an exportable summary for trade notes and audits
Method and assumptions
Why resolution review matters more than most traders think
Prediction markets compress a lot of legal and operational detail into a short market title. The trade may look simple on the surface, but settlement depends on definitions, official sources, timestamps, and venue-specific void or dispute rules.
- Ambiguous wording creates interpretation risk.
- Different venues can define the same event differently.
- Missing timezone or cutoff rules can change the outcome entirely.
- Void and dispute paths matter when the event becomes messy.
How to use the checklist before a trade
Start by documenting the exact market title and official source. Then confirm whether the question is unambiguous, whether the source is public, and whether the cutoff time and timezone are written clearly enough that another trader would reach the same interpretation.
- Capture the market title and official source in writing.
- Check wording, cutoff, timezone, void rules, and dispute rules.
- If the trade spans venues, confirm wording parity explicitly.
- Save the summary with the trade so the reasoning survives later review.
Worked resolution example
Imagine you want to hedge a Fed-related market between two platforms. One contract says "by July" and the other says "before the July meeting concludes." The prices may look complementary, but the wording difference could change settlement if the event lands near the deadline.
- Different phrasing can create non-equivalent markets.
- A blocker is not a minor issue; it is a trade-structure problem.
- Saved notes matter when you later review whether the trade process was sound.
Common mistakes in resolution review
The most common mistake is reading only the headline title and ignoring the rule detail. The second is assuming the official source is obvious when it is not written clearly. The third is failing to preserve notes, which makes later review or dispute handling much harder.
- Assuming similarity instead of proving parity
- Ignoring cutoff and timezone detail
- Skipping void or dispute rules because they seem unlikely
- Not saving written notes for future review
Simple decision rule: If a blocker remains unresolved, treat the market as high risk. Price edge does not compensate for a contract you may not fully understand.