Position sizing means choosing how much of your bankroll goes into a single prediction market trade, so that no one result can do serious damage.
Why Size Matters More Than Picks
Even good estimates are wrong often. If each position is small, a string of losses is survivable and your estimates have time to prove themselves.
The Fixed-Percentage Approach
Many learners use a simple rule: risk only a small fixed share of the bankroll per trade, such as 1% to 5%. As the bankroll changes, the amount changes with it.
Size and Price
Buying at 90¢ risks 90¢ to gain 10¢ per share. Buying at 10¢ risks 10¢ to gain 90¢. The same dollar amount carries very different loss and gain profiles depending on price.
Worked Example
With a $300 bankroll and a 3% rule, the maximum position is $9. At 45¢ per YES share, that buys 20 shares. If the market resolves NO, the loss is $9, leaving $291, and the next position becomes about $8.73.
Key Takeaways
- Decide position size before looking for trades.
- A fixed percentage keeps risk proportional to your bankroll.
- High prices mean small upside and large downside per share.
- Small positions give you time to learn.