Slippage

Every other market prices slippage in money. Here it also has a second unit, and the second one is the one that matters: the contract pays a fixed dollar, so the price you fill at is the probability you have bought. A few cents of slippage is not a rounding cost on the side of a forecast. It moves the forecast you are actually holding.

How it works

The reference is the price you saw, and the result is the average you got. A market shows 50 cents. You send an order for a thousand contracts. What comes back is a set of fills — some at 50, some at 51, the last few at 56 — and their average, say 53. The three cents between 50 and 53 are slippage. There are three ways to get them, and a prediction market has all three.

• Walking a book. On a central limit order book the order takes the best resting offer, then the next, then the next. How far it walks depends on the size resting at each level, and on a thin market there may be very little at any of them.
• Moving a curve. On an automated market maker there is no list of offers. Each contract bought moves the formula's price, and the average of the path is worse than where it started. A curve always quotes, and always charges for being used.
• Arriving late. The price moved between the moment it was on your screen and the moment the order reached the venue. On a market reacting to a vote count, a score or a data release, that interval can contain the whole move.

Cents are probability points

Pre-fee, the break-even probability of a Yes position is its average fill price. Slippage raises it point for point. That changes how to read a fill in two ways.

Near the middle it is a shift in the claim. Buying at an average of 53 on a contract shown at 50 is a statement that the event is more than 53 percent likely. If what you believed was 52, the slippage turned a position you agreed with into one you do not.

Near the edges it is a large share of the stake. Two cents on a 6-cent contract is a third of the price paid. The same two cents on a 94-cent contract is about two percent of the price, but it is a third of the six cents that contract can still earn. Either way the edge of the range is where a small absolute slip is a large fraction of something.

How a curve spreads it across the range

Hanson's 2002 paper on the logarithmic market scoring rule gives the price response of that market maker as a differential equation. For a two-outcome market, read from the trader's side, it reduces to: the change in price per contract bought is p(1 − p) divided by b, where p is the current price and b is a liquidity parameter the operator chooses. Two things follow. For a given b the price moves fastest at 50 cents and slowest near 1 and 99, so the same order slips more on a coin-flip than on a longshot. And b is set by the venue, not by the traders, so two markets with the same displayed price can slip very differently. The Futuur card records a liquidity-sensitive variant, LS-LMSR, in which slippage falls as a market gets busier.

One word, three different numbers

Venue documents use "slippage" for things that are not the same measurement, and a reader comparing them should know which is which.

• What happened — the realised gap on a fill, as defined above. No venue prints it for you in advance; it exists only after the order.
• What you allow — a tolerance, the furthest a market order may fill from the price shown before the rest is cancelled. The Crypto.com card records a default of $0.05 per contract on a market order, and the venue's help centre describes it as a set number of points from the displayed price, with the order filled immediate-or-cancel and not at all if the price has moved past it. That is a ceiling, not an estimate, and on a 20-cent contract it is a quarter of the price.
• What the currency swap costs — on a crypto venue the deposit or withdrawal can pass through a token swap with its own slippage limit. The how money gets out guide records a Polymarket bridge quote on a ten-dollar transfer with a 0.5 percent maximum slippage. It is a real cost, and it has nothing to do with the price of any contract.

Why it matters here

It is in no fee schedule. The catalogue's effective fee at fifty cents is a fee measurement: what the schedule charges on one contract at the midpoint. Slippage is the cost that measurement leaves outside, and on a thin market it can exceed the fee several times over. A card can tell you the rate. It cannot tell you what your order will do to a book it has never seen.

A displayed price on a thin market is a price for one small order. The catalogue's liquidity guide found every open Myriad market on 19 September 2026 quoting a two-decimal probability with a median liquidity figure of about $1,000 among the stablecoin markets. The number on the screen is real; the size behind it is what decides the fill, and it is shown in a different place, if at all. The mechanics are in where liquidity comes from.

You pay it twice. Getting in walks the book one way; getting out walks it the other, on whatever depth is there on the day you leave. A position that has to be exited early — because of a close-only status, a withdrawal need, or a changed view — meets the bid, not the midpoint.

Tools model it, and mostly optimistically. The Polyrama card records terms describing its simulated results as relying on optimistic fill models that do not reflect slippage or market impact. The Polycool card records the opposite kind of control, a slippage guard that skips a copied trade when the price has moved 1 to 10 cents past the leader's entry. A backtest or bot that fills at the displayed price is measuring something other than what the venue will do.

Price-as-probability comparisons need it subtracted. When a dashboard or a scoring page treats a market's price as the crowd's forecast, the relevant price for a trader is the fill, not the quote. On a deep market the two are close. On a shallow one they can be different forecasts.