A payout is the amount a contract pays its holder when the market settles, typically one dollar per winning contract and zero per losing one.
Last reviewed 29 October 2025 · Educational, not advice
A payout is the cash a contract returns to its holder when a market resolves. On a standard event contract, the rule is simple. If the defined outcome happens, each contract settles at one dollar. If it does not, each contract settles at zero. The payout is that settlement amount, and it is paid once the market closes against its stated resolution source. Until settlement you hold a contract whose price moves, but the payout itself is a fixed figure that arrives only at the end.
It helps to separate the payout from your profit. The payout is the gross amount you receive. Your profit is the payout minus what you paid to buy the contract and minus any fees the platform charges. A contract bought at sixty cents that pays one dollar gives you a payout of one dollar and a profit of forty cents, before fees. The same contract, if the outcome does not happen, pays a payout of zero and you lose the sixty cents you staked. The payout figure alone never tells you whether you made money.
Because the price you paid sets your cost, the payout structure is what turns a cheap contract into a large percentage return and an expensive one into a small one. A contract bought at ten cents that pays one dollar returns nine times the stake, while a contract bought at ninety cents that pays one dollar returns only about eleven percent. The lower price reflects a lower implied probability, so the larger potential return comes with a lower chance of any payout at all. There is no free reward here, only a trade between the size of the payout relative to cost and the odds of receiving it.
Some platforms describe a maximum payout, meaning the most a position can return if it wins in full. On a binary contract that ceiling is simply one dollar per contract, so a holding of one hundred winning contracts has a maximum payout of one hundred dollars before fees. Knowing the maximum payout, your cost, and any fees lets you see your best case, your break even, and your worst case, which is losing the whole stake, before you ever place an order.
A payout is not a guarantee. Many positions pay nothing because they settle on the losing side, and that is the ordinary outcome of a binary contract, not a malfunction. Payout timing also varies. It depends on how quickly the resolution source confirms the result and on the rules of the platform, so always read the resolution date and settlement terms of any market before you rely on when funds will arrive.
You buy forty contracts at sixty two cents each, a total cost of twenty four dollars and eighty cents. If the outcome happens, each contract settles at one dollar, so the payout is forty dollars and your profit before fees is fifteen dollars and twenty cents. If the outcome does not happen, the payout is zero and you lose the full twenty four dollars and eighty cents. The payout depends only on the result, while your profit depends on the result and the price you paid.
Illustrative only. Numbers are examples, not a quote or a prediction, and exclude fees.
A potential payout is never a promise. Most losing contracts pay nothing, and that is the ordinary risk of a binary market. Prediction markets can lose you money. Stake only what you can afford to lose, never to chase a loss, and never on borrowed money. In the United States you can call or text the helpline on 1-800-GAMBLER or visit ncpgambling.org.
A payout is the amount a contract pays its holder when the market settles. On a typical event contract that settles at one dollar if the outcome happens and zero if it does not, the payout on a winning contract is one dollar each, before fees.
No. The payout is the gross amount you receive at settlement. Your profit is the payout minus what you paid for the contract and minus any fees. A contract bought at sixty cents that pays one dollar returns forty cents of profit before fees.
A payout is credited at settlement, once the market resolves against its stated resolution source. Timing depends on the platform and on how quickly the outcome can be confirmed, so check the resolution date and rules for any market you hold.
Yes. If you hold the side that does not occur, your contracts settle at zero and the payout is nothing, so you lose what you paid. This is the normal risk of a binary contract, and it is why you should stake only what you can afford to lose.
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