Advanced resolution risk covers the ways a prediction market can resolve differently from what traders expect, even when the underlying event seems clear.
Ambiguous Wording
Small details in a market's rules, such as exact dates, time zones or definitions, can decide the result. Read every line before trading.
Source Dependence
Markets usually name a resolution source. Delays, corrections or changes at that source can affect timing and outcome.
Disputes and Clarifications
Platforms may clarify rules or handle disputes through their own process. Outcomes can take longer than expected.
Worked Example
A market asks whether a figure exceeds a threshold "by the end of the month." The trader notices the rules use a specific time zone, and the official release lands a few hours after midnight in that zone. That detail changes their view, so they skip buying YES at 85¢.
Key Takeaways
- Rules decide outcomes, not headlines.
- Check dates, time zones and definitions.
- Know the named resolution source.
- Allow for clarifications and delays.