Behind every prediction-market price sits an order book — the live list of who wants to buy and sell, and at what price. Learning to read it is the difference between guessing at a market and understanding it. This guide walks through what the book shows and how to use it.
What an order book is
An order book is simply two lists for a given contract: bids (orders from people wanting to buy, with the price they will pay) and asks or offers (orders from people wanting to sell, with the price they want). Each entry shows a price and a size — how many contracts are available at that level. The book is the raw supply and demand of the market, updating in real time.
Bids, asks and the spread
The best bid is the highest price anyone is currently willing to pay; the best ask is the lowest price anyone is willing to sell at. The gap between them is the spread. If the best bid is 61¢ and the best ask is 63¢, the spread is 2¢, and the “price” you see quoted is usually the midpoint, around 62¢. A tight spread signals a healthy, liquid market; a wide one signals a thin market where trading is more expensive.
Reading depth and liquidity
Beyond the best prices, the book shows depth — how many contracts are stacked at each level below the best bid and above the best ask. Deep books, with lots of size at many levels, let you trade large amounts without moving the price much. Shallow books mean even a modest order will eat through several levels and push the price — that is slippage. Always glance at the depth before sizing a trade, especially in less popular markets.
How a trade fills
When you place a market order to buy, it matches against the lowest asks in the book, starting at the best price and working up until your order is filled. A limit order instead joins the book at the price you set and waits for someone to trade against it. Understanding this is what makes the difference between paying the spread and earning it — covered in market orders vs limit orders.
For the underlying concept of what these prices mean, see why a price equals a probability, and for the full mechanics, how prediction markets work.
Frequently asked questions
What is an order book in a prediction market?
It is the live list of buy orders (bids) and sell orders (asks) for a contract, each showing a price and a size. It represents the market's real-time supply and demand and is where the quoted price comes from.
What does the spread tell me?
The spread is the gap between the best bid and best ask. A narrow spread indicates a liquid, healthy market where trading is cheap; a wide spread indicates a thin market where it costs more to get in and out.
How can I tell if a market is liquid?
Look at the depth of the order book — how many contracts are available at and near the best prices. Deep books with tight spreads are liquid; shallow books with wide spreads are thin and prone to slippage.