A prediction market is a market in shares of an outcome: every share is priced between $0.00 and $1.00 and redeems for $1.00 if it wins or $0.00 if it loses, so the price is the crowd's estimate of the probability. Nearly all prediction-market jargon hangs off that rule. This glossary defines the terms you will meet on Polymarket as of September 2026, grouped by where you meet them.
Market basics
The words on the market card itself.
Prediction market — A venue where users trade on real-world outcomes rather than betting against a house, so price reflects collective belief. See what Polymarket is.
Share (outcome token) — The unit of trade. Winning shares are redeemable for $1.00, losing shares are worth $0.00.
Market — The fundamental tradable unit: a single binary question with Yes and No outcomes.
Event — A container grouping related markets. It is how an election gets built, with one market per candidate.
Negative risk (neg risk) — Polymarket's link between mutually exclusive markets: exactly one resolves Yes, every other resolves No.
Resolution criteria — The pre-defined rules setting the winning condition and how edge cases are handled. Read them before you trade.
Resolution source — Where the outcome is determined from, such as an official announcement or a named website. Check which source a market names before you trade.
Resolution date — When a market is scheduled to settle. Settlements ahead sit on our resolution calendar; live questions on the markets page.Pricing, odds and probability
Price and probability are the same number in different clothes.
Implied probability — The price read as a percentage. A contract at 62 cents means the market sees roughly a 62% chance. More in understanding Polymarket odds.
Bid and ask — The bid is the highest price a buyer will pay; the ask, or offer, is the lowest a seller will take.
Spread — The gap between highest bid and lowest ask. Tighter spreads mean more liquid markets.
Midpoint — The displayed price is the midpoint of the spread: a $0.34 bid against a $0.40 ask shows as $0.37.
Last traded price — Shown instead of the midpoint when the spread is wider than $0.10, and in a thin market may not be a price you can get.The order book and execution
Central limit order book (CLOB) — A shared book of bids and asks. Prices are not set by Polymarket; they emerge as users trade.
Market order — Executes immediately at the best available price: buyers pay the lowest ask, sellers take the highest bid.
Limit order — Executes only at your price or better, sitting in the book until someone trades against it.
Maker and taker — A maker's order rests on the book providing liquidity; a taker removes it by hitting an order already there.
GTC and GTD — Good-till-cancelled orders stay live until you cancel; good-till-date orders expire at a timestamp you set.
Liquidity — How much size a market absorbs without the price moving. Filter by volume on our market screener.
Slippage — The gap between the price you expected and the average you paid, which grows as your order eats deeper into the book.Positions, settlement and resolution
What you hold, and how it turns back into money.
Position — Your token balance for a market. Its value is that balance times the current price.
Split and merge — Splitting $1 of collateral creates 1 Yes and 1 No token; merging turns an equal pair back into collateral.
Redeem — After resolution, exchanging winning tokens for $1.00 each. Losing tokens are worth nothing.
Exiting early — Selling before resolution to lock a profit or cut a loss. You get whatever the book offers, which in a thin market can be poor.
UMA Optimistic Oracle — Resolution on the main platform: a proposer submits the outcome with a bond, and token holders vote if disputed.
Proposal bond and challenge period — The proposer posts a bond, typically around $750, and anyone can dispute it within two hours by posting a matching counter-bond.
Dispute and DVM vote — Escalation to UMA's Data Verification Mechanism: 24 to 48 hours of debate plus roughly 48 hours of voting, four to six days in total.Fees and costs
Taker fee — On the main platform only takers pay; makers are never charged. The fee is shares times a category rate times price times one minus price.
Symmetric fee curve — The dollar fee peaks at 50 cents and is symmetric around it, so a trade at 30 cents costs the same as one at 70 cents.
Fee-free markets — Geopolitical and world events markets are fee-free, and Polymarket states it does not profit from trading there.
Deposit and withdrawal fees — Polymarket charges none on USDC, though intermediaries such as Coinbase or MoonPay may charge their own. See fees explained.Collateral, on-chain and whale-tracking terms
pUSD (Polymarket USD) — Collateral on the main platform: an ERC-20 backed by USDC with backing enforced on-chain. Deposited USDC or USDC.e is wrapped into it.
Bridge address — A chain-specific address tied to your wallet; assets sent there are bridged and swapped to pUSD automatically. See depositing.
Conditional Tokens Framework (CTF) — The Gnosis open standard that turns each outcome into an ERC-1155 token on Polygon, the chain the main platform settles on.
Whale — A trader with an unusually large position. There is no official threshold; the label is relative. Our whale tracker ranks the largest holders.
Smart Money Score — Our ranking signal on the whale tracker, so large wallets can be sorted rather than just listed. More in the whale guide.
Flow — New orders and positions hitting a market. The large ones surface in our alerts feed, on biggest bets and among the 24h movers.Perps terms
Polymarket Perps launched broadly on September 3, 2026. It is a different instrument from event shares: leveraged, continuous, and able to close your position for you. The United States and Canada are blocked from placing orders. See our Perps hub.
Perpetual contract (perp) — A contract tracking an underlying index, commodity, crypto asset or equity. Perps trade continuously and never expire.
Index price and mark price — The index tracks the underlying; the mark price drives account equity, margin checks and liquidation risk.
Long and short — A long gains when price rises, a short when it falls. Each loses on the opposite move, amplified by leverage.
Leverage — Borrowed exposure: as of September 2026, up to 20x on major crypto, index and commodity markets and 10x on single stocks. It magnifies losses exactly as much as gains.
Leverage tiers — Brackets that cut maximum leverage as a position grows. On BTC-USD it steps from 20x below $250,000 of notional to 1x above $10 million.
Notional — The dollar size of a position, price times quantity. Fees and margin are figured on notional, not on your deposit.
Initial margin — Collateral required to open or increase a position, equal to notional divided by leverage.
Maintenance margin — The minimum collateral to keep a position open: notional times a rate of 0.5 divided by the market's maximum leverage, so 2.5% on a 20x market.
Account equity — Collateral plus unrealized profit and loss at the mark price, less fees and funding due.
Margin call and reduce-only — Equity between maintenance and initial margin. You may only cut exposure or add collateral, not add risk.
Liquidation — When equity falls below maintenance margin the system closes the position, and those fills carry extra fees. Model yours on the Perps calculator.
Funding rate — An hourly transfer keeping the contract near the index: above index longs pay shorts, below it shorts pay longs, capped at plus or minus 4% per hour.
Open interest — The total size of contracts open in a market, the standard measure of live exposure. Per-market figures sit on our Perps screener.
Perps fees — Base-tier rates are 0.0400% taker and 0.0125% maker, charged on the notional value of each fill. Examples in our Perps fee schedule.Outside the United States and Canada you can open Polymarket Perps; availability depends on your jurisdiction, and the risks are set out in is Polymarket Perps safe.
Regulation and access terms
CFTC — The Commodity Futures Trading Commission, the US regulator with jurisdiction over futures, options and swaps.
Designated contract market (DCM) — An exchange under CFTC oversight pursuant to Section 5 of the Commodity Exchange Act, able to list futures or options on any underlying commodity, index or instrument.
Derivatives clearing organization (DCO) — The clearing function. Polymarket US operates as both DCM and DCO under CFTC oversight.
Event contract — A contract settling on a real-world outcome. Polymarket US describes its event contracts as regulated event-based derivatives reflecting real events, not company performance or securities.
Swap execution facility (SEF) — Another CFTC registration category. In January 2022 the CFTC ordered Blockratize, Inc. d/b/a Polymarket to pay a $1.4 million penalty for failing to obtain DCM designation or SEF registration.
Geo-restriction — A block based on location. Trading is blocked in the United States on polymarket.com, Perps blocks US and Canadian orders, and Polymarket US is not in every state. Circumventing any of these violates the platforms' terms.US readers should use Polymarket US plus our free tools; readers elsewhere can open Polymarket, where availability depends on jurisdiction. Country detail sits in is Polymarket legal.
Frequently asked questions
What is the most important term to understand first?
Implied probability. Once you read 62 cents as "roughly a 62% chance," every other term becomes a detail of how you buy, hold or exit that claim. Traders who skip it treat the price as an odds board rather than a number they can disagree with.
Where should I look up a term while I am trading?
Keep this page open beside the market you are in. For price and probability, understanding Polymarket odds; for order mechanics, how to use Polymarket; for strategy vocabulary, how to make money on Polymarket. No strategy removes the risk of loss.
Do the same terms apply on Polymarket US?
Most of the vocabulary carries over: a central limit order book, prices as probabilities, contracts settling at $1 or $0, and the ability to sell before the outcome is known. The regulatory wrapper differs, since Polymarket US is a CFTC-regulated DCM and DCO trading in US dollars, and on-chain terms such as pUSD do not apply.
Which Perps terms matter before using leverage?
Maintenance margin, liquidation and funding rate, in that order. Maintenance margin tells you how thin your buffer is, liquidation is what happens when it runs out, and funding accrues every hour you hold. Leverage magnifies losses as much as gains, and a liquidation can take the entire position.
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