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Forecast Contract

Trading Term

A Forecast Contract is an exchange-traded event contract that settles at $1.00 if a defined outcome occurs and $0.00 if it does not. Because the payout is binary and fixed, the price of a YES contract can be read directly as the market’s collective estimate of the probability of the event, so a contract trading at $0.30 corresponds to roughly a 30% chance. ForecastEx lists Forecast Contracts on outcomes such as daily high and low temperatures at specific weather stations, Atlantic hurricane counts, major hurricane landfall by region, severe storm counts, crop yields, and global temperature thresholds.

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