Creating your first prediction market trade is simpler than it looks. You pick a platform, add funds, choose a market, and place an order. This guide walks you through each step so you can go from signup to your first position without guesswork.
Why Start With One Trade
Before diving in, it helps to know why starting small matters.
- You learn the mechanics—order types, settlement, and how prices move.
- You see real risk—your loss is capped at what you pay for the contract.
- You avoid overconfidence—one successful trade doesn’t mean you’ve figured out the market.
One clear, small trade is better than many confused ones.
Choose a Platform and Fund Your Account
Your first decision is where to trade.
Pick a Platform
- Kalshi: Regulated in the U.S., USD, bank transfer. Best if you want a fully legal, simple setup.
- Polymarket: Global liquidity, USDC, crypto. Best if you’re comfortable with crypto and want fast-moving markets.
- Pariflow: Social and AI-assisted trading, USDC. Best if you like following or comparing with other traders.
Choose based on regulation, currency, and whether you prefer traditional finance or crypto.
Fund Your Account
- Kalshi: ACH or wire in USD. Usually 1–3 business days.
- Polymarket / Pariflow: Send USDC to your wallet or use the in-app deposit flow. Often same-day.
Start with an amount you’re willing to lose—for example $20–$50. You can always add more later.
Find Your First Market
Not every market is a good first trade.
What to Look For
- Clear resolution: The outcome is determined by a specific rule or data source (e.g. “Fed cuts rate by X date” or “Candidate X wins state Y”).
- Enough liquidity: You can buy and sell without moving the price a lot. Avoid markets with a wide bid-ask spread if you’re learning.
- Something you understand: Don’t trade macro or niche events until you’re comfortable with the basics.
Browse the “Politics,” “Economics,” or “Crypto” sections and open a few markets. Read the resolution rules and the expiry date.
Example First Market
A market like “Will the Fed cut rates by March 15?” is binary (Yes/No), has a clear resolution (Fed decision + date), and is easy to understand. You don’t need to be an economist—you only need a view on whether the current price is too high or too low.
Place Your First Order (Yes/No, Size, Limit vs Market)
Once you’ve chosen a market, you choose a side, a size, and an order type.
Yes or No
- Yes: You profit if the event happens. You buy “Yes” contracts.
- No: You profit if the event does not happen. You buy “No” contracts.
Yes + No together usually sum to about $1.00 (e.g. Yes at $0.60, No at $0.40).
Size
- Each contract typically pays $1.00 if you’re right.
- If you buy 10 “Yes” at $0.40, you pay $4.00. If correct, you receive $10.00 (profit $6.00). If wrong, you lose $4.00.
Start with 5–20 contracts so the dollar amount is small and the math is easy.
Limit vs Market
- Limit order: You set the price (e.g. “Buy Yes at $0.38 or better”). Your order fills only if someone is willing to sell at that price. You control price; execution isn’t guaranteed.
- Market order: You accept the best available price. Execution is fast; price may be slightly worse than the last trade.
For a first trade, a limit order at or near the best ask is a good balance: you get filled quickly without giving up too much edge.
What Happens After You Buy
After your order fills:
- Position: You hold a number of “Yes” or “No” contracts. The market will show your average price and current value.
- Settlement: When the event resolves, winning contracts pay $1.00 each; losing contracts go to $0.00. The platform credits or debits your account.
- Before settlement: You can sell your position at any time at the current market price. You don’t have to hold until the event ends.
So you’re not locked in—you can take profit or cut losses early.
When to Sell Early
Many traders never hold to settlement.
- Price moved in your favor: You bought Yes at $0.40 and it’s now $0.55. Selling locks in about $0.15 per share profit.
- Your view changed: New information makes you less confident. Selling limits further loss.
- You need the capital: You’d rather use the money in another market. Selling frees it up.
Selling early is normal. The only reason to hold to settlement is if you believe the current price still misvalues the outcome.
Common Mistakes to Avoid
- Trading markets with unclear resolution: If the rules are vague, disputes happen. Stick to clear, rule-based markets at first.
- Going too big too soon: One big win can encourage overtrading. Keep position sizes small while you learn.
- Chasing momentum: Buying because “everyone” is buying often leads to buying high. Have a view on probability, not just on price direction.
- Ignoring fees: Some platforms charge per trade or on withdrawal. Check the fee page so you’re not surprised.
Trader insight: Your edge is “I think this outcome is more likely than the price implies.” If you can’t say that in one sentence, skip the trade.
Next Steps
After your first trade:
- Watch the market until it resolves (or until you sell). See how price reacts to news.
- Try one limit order and one early exit so you learn both flows.
- Read the resolution rules of your next market before you trade.
You don’t need to trade every day. A few deliberate trades will teach you more than dozens of random ones.
Once you’re comfortable with one platform and one type of market, you can explore other categories and platforms—and use the same logic: Is this outcome more or less likely than the price suggests?