Glossary term
Resolution (Prediction Markets)
The criteria that determine a contract's payout; ambiguous resolution wording is the source of most retail losses.
Resolution is the set of criteria that determine how a prediction-market contract pays out once the event concludes. The precise wording matters enormously: contracts that look like sure things can pay out unexpectedly because of an edge case in the resolution rules. Closelook flags resolution-wording risk as the single most common cause of avoidable retail losses in prediction markets. See Prediction Market Risk 101.