The mechanism

1 share of each outcome together is exchangeable for M$1
The product of the shares in the pool remains constant across operations
- This constant is called k
The probability of an outcome can be calculated as follows:
```
getProb(pool, outcome) {
	const basis = pool[outcome]
	const ratioSum = sumBy(Object.values(pool), (value) => basis / value)
	return 1 / ratioSum
}
```
- Output prob ranges from 0 to 1, inclusive
- Note that the more shares the less likely the outcome

Buy outcome with M$ amount
- Split each M$ into one share of each outcome, and add to the pool
  - (This increases k, the product of the shares of in the pool…)
- Remove shares from the outcome you are buying until k is as it was
Sell shares of outcome
- Add your shares of an outcome into the pool
- Remove equal shares in every outcome simultaneously until k is as it was
- Redeem those shares for M$
Short sell an outcome for M$ amount
- Split each M$ into one share of each outcome, and add to the pool
- Remove shares equally in every outcome except the one you are short selling until k is as it was.

Resources