Calibration
Calibration measures whether probability forecasts correspond reasonably well with how often those outcomes actually occur over many forecasts.
Why it matters to you
If a forecaster labels many comparable events as having a 70% probability, approximately 70% of those events should occur over a sufficiently large and appropriate sample for the forecasts to be well calibrated. Calibration helps traders evaluate whether their probability estimates are systematically too confident or too cautious.
Terms that sit next to this one
See the prediction markets front
Live odds, what settles this week and five tools.