Contingency markets are markets where

contract A contract is an agreement that specifies certain legally enforceable rights and obligations pertaining to two or more parties. A contract typically involves consent to transfer of goods, services, money, or promise to transfer any of thos ...

s are made to exchange funds contingent upon an event or combination of events or contingencies thereof.

Difference from prediction markets

Prediction market Prediction markets, also known as betting markets, information markets, decision markets, idea futures or event derivatives, are open markets that enable the prediction of specific outcomes using financial incentives. They are exchange-traded mar ...

s are a subset of contingency markets and specialise in independent future events and are often exploited for the predictive side effect they produce. Complex contingencies only tend to occur in the

gambling Gambling (also known as betting or gaming) is the wagering of something of Value (economics), value ("the stakes") on a Event (probability theory), random event with the intent of winning something else of value, where instances of strategy (ga ...

industry's implementations of prediction markets. Unlike prediction markets, contingency markets also support dependent future events. These are

a priori ('from the earlier') and ('from the later') are Latin phrases used in philosophy to distinguish types of knowledge, Justification (epistemology), justification, or argument by their reliance on experience. knowledge is independent from any ...

directly influenced or controlled by those interested in a particular outcome of an event.

References

{{Reflist Prediction markets Wagering

Difference from prediction markets

See also

References