How can you profit in prediction markets? Choose YES or NO—this question isn't that simple.

The first reaction of ordinary investors is often to buy YES. The reason is quite natural—certainty is always easier to accept. Plus, people inherently enjoy the thrill of betting small for big gains, and the temptation to bet on low-probability events at low cost is strong.

The problem lies here. When most people tend to buy YES, the market pricing will follow, gradually pushing up the price of YES. You can imagine: the more people optimistic about a certain outcome, the more expensive the contract corresponding to that outcome becomes.

Conversely, the overlooked NO may present an undervaluation opportunity. This doesn't mean that the opposite outcome will definitely happen, but rather that the market's odds have over-reflected human optimism bias. Traders who understand how to go against human nature often find chips here.