Evercore ISI finds higher prediction market volume yields more reliable probabilities

Evercore ISI strategists led by Julian Emanuel published research Monday finding that prediction market contracts with higher trading volume produce more reliable probabilities than shallow, thinly traded markets. The study evaluates when prediction markets are most useful as forecasting tools and identifies liquidity as a key quality filter for distinguishing trustworthy prices from noise. The framework applies across politically themed contracts and other event markets where volume varies significantly. Emanuel's team framed the findings as practical guidance for investors weighing prediction market signals against traditional polling data.