In this guide
Key takeaway: Prediction markets enable you to trade on outcomes of real-world events. Purchase YES or NO shares that are worth $1 upon a correct prediction. This approach is far less complicated than traditional stock trading, and entry requires only $1 minimum.
Greetings to the world of prediction markets. If you have ever declared "I reckon that will occur" — you are already operating with a prediction market trader's mindset. The distinction is that in this environment, you can commit genuine capital to your beliefs and earn returns when your forecast proves accurate. This beginner's guide to prediction markets will have you executing trades within five minutes.
How prediction markets work (the 60-second version)
Prediction markets establish tradeable propositions surrounding forthcoming occurrences. For instance:
- "Will the Fed cut interest rates in June?" — YES shares at $0.65, NO shares at $0.35
- "Will Bitcoin close above $90K on December 31?" — YES shares at $0.55, NO shares at $0.45
- "Will France win the 2026 World Cup?" — YES shares at $0.13, NO shares at $0.87
Each share is valued at precisely $1 upon the event occurring, or $0 if it does not materialise. The prevailing market price embodies the collective probability assessment. Should you believe the market has mispriced the outcome, you can execute a trade — and when your assessment proves correct, you capture profit.
Step 1: Choose a platform
The two dominant prediction market platforms are:
- Polymarket — leading in trading volume, blockchain-based (USDC on Polygon), accessible worldwide (excluding US)
- Kalshi — CFTC-regulated, dollar-denominated, restricted to US participants
PolyGram connects you to Polymarket's depth of liquidity through a streamlined platform — email authentication, no blockchain wallet required, and optimised for mobile users. We suggest beginning your journey here.
Step 2: Fund your account
Account funding through PolyGram is hassle-free. Deposit options include debit card or cryptocurrency transfers. Begin modestly — £7-35 suffices for initial transactions. Additional funds can be contributed whenever desired.
Step 3: Find a market you understand
The most frequent novice error involves trading in markets outside your knowledge base. Select a domain you actively monitor:
- Engaged with politics? Begin with electoral markets
- Engaged with sports? Trade on game results and tournament outcomes
- Engaged with cryptocurrency? Wager on price targets and milestones
- Engaged with technology? Forecast product announcements and policy outcomes
Step 4: Place your first trade
Navigate PolyGram's markets page and identify a proposition where you believe the current valuation is inaccurate. Should the market price it at 40% but your assessment suggests 60%, acquire YES shares. Your gain if your prediction materialises: $1.00 - $0.40 = $0.60 per share (representing a 150% gain).
Step 5: Manage your position
Upon acquiring shares, you face three pathways:
- Hold until resolution: Remain invested until the event concludes. Upon a correct prediction, shares automatically settle at $1
- Sell early: Should market movement favour your position ahead of settlement, liquidate for gains without awaiting final resolution
- Cut your losses: When fresh data contradicts your original thesis, exit the position at a loss rather than gambling on recovery
Risk management for beginners
- Avoid committing beyond 5% of your account balance to any single market
- Concentrate on active markets (substantial trading volume, narrow bid-ask gaps) — sidestep obscure questions with minimal participation
- Document your profitable and unprofitable trades to identify patterns in your decision-making
- Keep in mind: even markets priced at 90% probability fail one time in ten
Prepared to execute your inaugural prediction market transaction? Start trading on PolyGram →