HIP-4 Research

Does the market know what it is talking about?

A prediction market states a probability. This page checks it. For every settled HIP-4 market we take the price traders actually paid for a side, bucket it, and count how often that side won.

Backing the favouriteEvery buy at 50¢ or more, one unit each, paid at its own price: what those trades returned on average. Positive means favourites were too cheap.

+2.3%

per trade, favourites only, at the price paid

Trades studied

4,945,157

from 3,533 settled markets

TradedThe same edge weighted by dollars rather than by trade — what a dollar staked on the favourites returned.

$279.68M

+1.6% per dollar on the favourites

What the price implied, and what happenedMarkets grouped by the price paid for the Yes side; the last column is how often it won.

Backing the favourite: +2.3% per trade · 4,945,157 trades from 3,533 markets

Price paidTradesImpliedWonWon

0–10¢364,5463.0%1.3%
10–20¢314,17615.1%23.4%
20–30¢338,29624.8%17.4%
30–40¢495,97035.4%30.7%
40–50¢734,10845.3%43.0%
50–60¢886,13754.6%56.8%
60–70¢609,47964.6%68.0%
70–80¢425,88975.1%83.2%
80–90¢411,00084.7%79.7%
90–100¢365,55695.9%98.2%

A bucket with no market is left out rather than drawn at zero. "Too cheap" means the side won more often than its price implied — a buyer got a bargain; "too pricey", less often.

Method, and what it does not say

The unit is the trade. Every buy of a settled market is a claim at the price it paid, on the side it bought, and it won if that side won. Trades are not independent — the fills of one market settle together — so the number of markets behind them is printed beside them, and the per-market view (one vote per market) is kept as the check.
The price is volume-weighted across every indexed fill on the Yes leg, trade rows only — mints, merges and settlements print at 0.50, 1 or 0 and are mechanics, not opinions.
It is an average over the market's whole life, not the closing line. It measures what traders paid, not what the book last thought.
Markets whose Yes leg never traded carry no price and are excluded, as are draws: a two-sided match that ends level pays both sides $0.50 and has no winning leg.
The two families are folded separately on purpose. They share no traders, no deployers and no resolution source, so a bias present in both is a property of the market rather than of one crowd.