market-mechanics-betting

# Market Mechanics & Betting

## Table of Contents
- [What is Market Mechanics?](#what-is-market-mechanics)
- [When to Use This Skill](#when-to-use-this-skill)
- [Interactive Menu](#interactive-menu)
- [Quick Reference](#quick-reference)
- [Resource Files](#resource-files)

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## What is Market Mechanics?

**Market mechanics** translates beliefs (probabilities) into actions (bets, decisions, resource allocation) using quantitative frameworks.

**Core Principle:** If you believe something with X% probability, you should be willing to bet at certain odds.

**Why It Matters:**
- Forces intellectual honesty (would you bet on this?)
- Optimizes resource allocation (how much to bet?)
- Improves calibration (betting reveals true beliefs)
- Provides scoring framework (Brier, log score)
- Enables aggregation (extremizing, market prices)

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## When to Use This Skill

Use when:
- Converting belief to action - Have probability, need decision
- Betting decisions - Should I bet? How much?
- Resource allocation - How to distribute finite resources?
- Scoring forecasts - Measuring accuracy (Brier score)
- Aggregating forecasts - Combining multiple predictions
- Finding edge - Is my probability better than market?

Do NOT use when:
- No market/betting context exists
- Non-quantifiable outcomes
- Pure strategic analysis (no probability needed)

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## Interactive Menu

**What would you like to do?**

### Core Workflows

**1. [Calculate Edge](#1-calculate-edge)** - Determine if you have an advantage
**2. [Optimize Bet Size (Kelly Criterion)](#2-optimize-bet-size-kelly-criterion)** - How much to bet
**3. [Extremize Aggregated Forecasts](#3-extremize-aggregated-forecasts)** - Adjust crowd wisdom
**4. [Optimize Brier Score](#4-optimize-brier-score)** - Improve forecast scoring
**5. [Hedge and Portfolio Betting](#5-hedge-and-portfolio-betting)** - Manage multiple bets
**6. [Learn the Framework](#6-learn-the-framework)** - Deep dive into methodology
**7. Exit** - Return to main forec