Robinhood

Prediction Markets

Prediction markets explained

A comprehensive guide to trading event contracts

01
Prediction Markets
Getting started with prediction markets

Getting started with prediction markets

Prediction markets offer a unique way to engage with uncertainty. This introductory guide explains how event contracts work, how prices reflect probabilities, and how to approach prediction markets thoughtfully—whether you trade them or simply want to learn from them.
02
Prediction Markets
What are prediction markets?

What are prediction markets?

Prediction markets turn uncertainty into prices. This article explains how prediction markets work, how event contract prices reflect probabilities, and why people use them to understand expectations around real-world events.
03
Prediction Markets
What are event contracts?

What are event contracts?

Event contracts are the foundation of prediction markets. This guide explains how Yes and No contracts work, how prices reflect probability, how contracts settle, and why understanding definitions and edge cases matters before trading.
04
Prediction Markets
How event contract pricing works

How event contract pricing works

Event contract prices reflect how likely the market believes an outcome is—not what will happen. This guide explains how pricing works, why prices move before events resolve, and how to think about probability, edge, and expectations in prediction markets.
05
Prediction Markets
Profit vs. payout: understanding gains and losses in event contracts

Profit vs. payout: understanding gains and losses in event contracts

Event contracts pay out $1 or $0 at settlement—but your profit or loss depends on the price you paid and when you exit. This article explains how gains and losses work, including holding to settlement, closing early, and why price matters.
06
Prediction Markets
How prediction markets are structured

How prediction markets are structured

Prediction markets aren’t run by a single company. This guide explains how prediction markets are structured, including the roles of exchanges, brokers, regulators, market makers, and source agencies—and how prices actually form.
07
Prediction Markets
Managing risk when trading event contracts

Managing risk when trading event contracts

Risk management is the foundation of event contract trading. Learn how position sizing, liquidity, selectivity, and behavioral discipline shape long-term outcomes in prediction markets.
08
Prediction Markets
Understanding orders, prices, and liquidity in event contracts

Understanding orders, prices, and liquidity in event contracts

Orders, prices, and liquidity shape every event contract trade. Learn how bid-ask spreads, order types, and execution risk impact fills—and why patience and order management matter.
09
Prediction Markets
Trading economic and financial data event contracts

Trading economic and financial data event contracts

Explore how economic event contracts work, from inflation and jobs data to Fed rate decisions. Learn how expectations shape prices and how binary outcomes differ from traditional markets.
010
Prediction Markets
Trading sports event contracts

Trading sports event contracts

Explore how to trade sports event contracts across game outcomes, spreads, totals, player performance, and combos. Learn how probability, liquidity, and execution shape risk and reward.
11
Prediction Markets
Trading political event contracts

Trading political event contracts

Explore how to trade political event contracts tied to elections and policy outcomes. Learn how timelines, polls, liquidity, and emotion shape pricing and risk in prediction markets.
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Prediction Markets
Trading climate & weather event contracts

Trading climate & weather event contracts

Explore how climate and weather event contracts trade measurable outcomes like temperature and storm activity. Learn how data sources, timing, and liquidity shape pricing and risk.
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Prediction Markets
Trading entertainment event contracts

Trading entertainment event contracts

Explore how entertainment event contracts trade awards, pop culture events, and voting outcomes. Learn how narrative, momentum, liquidity, and risk shape pricing in prediction markets.
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Prediction Markets
Trading technology event contracts

Trading technology event contracts

Explore how technology event contracts trade AI breakthroughs, company milestones, regulatory approvals, and space missions. Learn how timelines, execution, liquidity, and hype shape pricing and risk.
15
Prediction Markets
Trading education event contracts

Trading education event contracts

Explore how education event contracts trade tuition, rankings, and policy-driven outcomes. Learn how institutional incentives, long timelines, and liquidity shape pricing and risk.
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Prediction Markets
Trading crypto event contracts

Trading crypto event contracts

Explore how crypto event contracts trade Bitcoin price levels and time-based milestones. Learn how volatility, probability, and hedging strategies shape risk and reward.
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Futures, options on futures, and cleared swaps trading is offered by Robinhood Derivatives, LLC (RHD), a registered futures commission merchant with the Commodity Futures Trading Commission (CFTC) and Member of National Futures Association (NFA). RHD is not FDIC insured or SIPC protected.

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This information is educational, and is not an offer to sell or a solicitation of an offer to buy any security. This information is not a recommendation to buy, hold, or sell an investment or financial product, or take any action. This information is neither individualized nor a research report, and must not serve as the basis for any investment decision. All investments involve risk, including the possible loss of capital. Past performance does not guarantee future results or returns. Before making decisions with legal, tax, or accounting effects, you should consult appropriate professionals. Information is from sources deemed reliable on the date of publication, but Robinhood does not guarantee its accuracy.

Options trading entails significant risk and is not appropriate for all customers. Customers must read and understand the Characteristics and Risks of Standardized Options before engaging in any options trading strategies. Options transactions are often complex and may involve the potential of losing the entire investment in a relatively short period of time. Certain complex options strategies carry additional risk, including the potential for losses that may exceed the original investment amount.

Futures, options on futures, and cleared swaps trading is offered by Robinhood Derivatives, LLC (RHD), a registered futures commission merchant with the Commodity Futures Trading Commission (CFTC) and Member of National Futures Association (NFA). RHD is not FDIC insured or SIPC protected.

Review Robinhood Financial’s Fee Schedule to learn more regarding brokerage transactions. Review Robinhood Derivatives's Fee Schedule to learn more about commissions on futures transactions.

Brokerage services are offered through Robinhood Financial LLC, (RHF) a registered broker dealer (member SIPC) and clearing services through Robinhood Securities, LLC, (RHS) a registered broker dealer (member SIPC).

Cryptocurrency services are offered through Robinhood Crypto, LLC (RHC) (NMLS ID: 1702840). Robinhood Crypto is licensed to engage in virtual currency business activity by the New York State Department of Financial Services.

The Robinhood spending account is offered through Robinhood Money, LLC (RHY) (NMLS ID: 1990968), a licensed money transmitter. A list of our licenses has more information.

The Robinhood Cash Card is a prepaid card issued by Sutton Bank, Member FDIC, pursuant to a license from Mastercard®. Mastercard and the circles design are registered trademarks of Mastercard International Incorporated.

Funds held in your Robinhood Cash Card account at Sutton Bank are eligible for FDIC insurance up to $250,000 and will not accrue or pay any interest. The availability of FDIC insurance is contingent upon Robinhood maintaining records acceptable to the FDIC, as receiver, if Sutton Bank should fail. FDIC insurance limits apply collectively to all of your deposits held at Sutton Bank.

RHF, RHS, RHD, RHC, and RHY are affiliated entities and wholly owned subsidiaries of Robinhood Markets, Inc. RHF, RHS, RHD, RHC, and RHY are not banks. Products offered by RHF are not FDIC insured and involve risk, including possible loss of principal. RHC is not a member of FINRA and accounts are not FDIC insured or protected by SIPC.

RHY is not a member of FINRA and accounts are not FDIC insured or protected by SIPC. RHY is not a member of FINRA, and products are not subject to SIPC protection, but funds held in the Robinhood spending account and Robinhood Cash Card account may be eligible for FDIC pass-through insurance (review the Robinhood Cash Card Agreement and the Robinhood Spending Account Agreement).

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Robinhood, 85 Willow Road, Menlo Park, CA 94025. © 2026 Robinhood. All rights reserved.
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This information is educational, and is not an offer to sell or a solicitation of an offer to buy any security. This information is not a recommendation to buy, hold, or sell an investment or financial product, or take any action. This information is neither individualized nor a research report, and must not serve as the basis for any investment decision. All investments involve risk, including the possible loss of capital. Past performance does not guarantee future results or returns. Before making decisions with legal, tax, or accounting effects, you should consult appropriate professionals. Information is from sources deemed reliable on the date of publication, but Robinhood does not guarantee its accuracy.

Options trading entails significant risk and is not appropriate for all customers. Customers must read and understand the Characteristics and Risks of Standardized Options before engaging in any options trading strategies. Options transactions are often complex and may involve the potential of losing the entire investment in a relatively short period of time. Certain complex options strategies carry additional risk, including the potential for losses that may exceed the original investment amount.

Futures, options on futures, and cleared swaps trading is offered by Robinhood Derivatives, LLC (RHD), a registered futures commission merchant with the Commodity Futures Trading Commission (CFTC) and Member of National Futures Association (NFA). RHD is not FDIC insured or SIPC protected.

Review Robinhood Financial’s Fee Schedule to learn more regarding brokerage transactions. Review Robinhood Derivatives's Fee Schedule to learn more about commissions on futures transactions.

Brokerage services are offered through Robinhood Financial LLC, (RHF) a registered broker dealer (member SIPC) and clearing services through Robinhood Securities, LLC, (RHS) a registered broker dealer (member SIPC).

Cryptocurrency services are offered through Robinhood Crypto, LLC (RHC) (NMLS ID: 1702840). Robinhood Crypto is licensed to engage in virtual currency business activity by the New York State Department of Financial Services.

The Robinhood spending account is offered through Robinhood Money, LLC (RHY) (NMLS ID: 1990968), a licensed money transmitter. A list of our licenses has more information.

The Robinhood Cash Card is a prepaid card issued by Sutton Bank, Member FDIC, pursuant to a license from Mastercard®. Mastercard and the circles design are registered trademarks of Mastercard International Incorporated.

Funds held in your Robinhood Cash Card account at Sutton Bank are eligible for FDIC insurance up to $250,000 and will not accrue or pay any interest. The availability of FDIC insurance is contingent upon Robinhood maintaining records acceptable to the FDIC, as receiver, if Sutton Bank should fail. FDIC insurance limits apply collectively to all of your deposits held at Sutton Bank.

RHF, RHS, RHD, RHC, and RHY are affiliated entities and wholly owned subsidiaries of Robinhood Markets, Inc. RHF, RHS, RHD, RHC, and RHY are not banks. Products offered by RHF are not FDIC insured and involve risk, including possible loss of principal. RHC is not a member of FINRA and accounts are not FDIC insured or protected by SIPC.

RHY is not a member of FINRA and accounts are not FDIC insured or protected by SIPC. RHY is not a member of FINRA, and products are not subject to SIPC protection, but funds held in the Robinhood spending account and Robinhood Cash Card account may be eligible for FDIC pass-through insurance (review the Robinhood Cash Card Agreement and the Robinhood Spending Account Agreement).

4784959

Robinhood, 85 Willow Road, Menlo Park, CA 94025. © 2026 Robinhood. All rights reserved.