> For the complete documentation index, see [llms.txt](https://foregate.gitbook.io/foregate-docs/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://foregate.gitbook.io/foregate-docs/market-types-and-mechanisms/events-and-matches/creator-market-details.md). # Creator Market Details Foregate’s public creation guide lists AMM, Pari-Mutuel, and liquidity-provider integration as supported or planned market mechanisms ## **Automated Market Makers (AMMs Market )** Our **prediction markets** support **Automated Market Makers (AMMs)** based on the **Constant Product Model (*****x*** X ***y***** = *****k*****)** to enable **decentralized trading** of **binary outcomes** (e.g., "Yes/No" or "For/Against"). Each market has two **outcome Shares** (e.g., YES and NO), and the **AMM pool** holds **reserves** of both. The **product of the reserves** (***YES***_*reserves* X ***NO***_*reserves* = *k*) remains **constant**, ensuring **liquidity**. ### ^**A]** Buying Outcome Shares {% stepper %} {% step %} #### Step 1 * **Split collateral** (e.g., USDT) into **equal amount** of both **outcome Shares** (**1:1 ratio**). If all looks good, hit the **Buy** button. You can then track your position via the [**Portfolio**](https://www.foregate.com/en/portfolio) **page**. * Example: $10 USDT (\rightarrow ) 10 YES + 10 NO. {% endstep %} {% step %} #### Step 2 * **Swap** the unwanted outcome Shares (e.g., NO) for the desired Shares (YES) via the **AMM pool**. * Final Amount: The sum of the desired tokens splitted + tokens bought from the swap = **total YES tokens purchased**. {% endstep %} {% endstepper %} ### ^**B]** Selling Outcome Shares {% stepper %} {% step %} #### Step 1 * **Swap a portion** of the held Shares (e.g., YES) for the **complementary outcome** (NO) in the **AMM pool**. {% endstep %} {% step %} #### Step 2 * **Merge** the remaining held Shares (YES) and the newly acquired NO Shares **back into USDT** (**1:1**). {% endstep %} {% endstepper %} {% hint style="warning" %} ## **Tips | Important Notice :** ### **Why AMM does not support limit orders** **AMMs** like the **Constant Product Market Maker (CPMM)** used on our platform fundamentally differ from **order book-based systems**, which is why they do not **natively support limit orders**. They replace order books with **algorithmic liquidity pools**. 1. **Price changes with every trade:** The price in an AMM changes with every trade. A "**limit order**" would require a **static price point**, which contradicts how AMMs work. 2. **No pending orders mechanism:** There is no pending orders mechanism for AMMs. AMMs only **execute trades immediately** at the current **pool-determined price**. However, in an order book, a limit order sits idle until the market hits its price. {% endhint %} *** ## **Pari-Mutuel Market** ### **Model Definition & Core Mechanism** The **Pari-Mutuel model**, also known as the **shared pool system**, consolidates all participant funds into a **collective pool**. **Winners share the pool proportionally** after deducting applicable fees—similar to the "**total pool distribution (totalizator)**" system used in horse racing. Participants make predictions on an event outcome and contribute funds based on their prediction. Once the result is revealed, funds are **distributed according to the correct predictions**. Odds and payouts are calculated simply by **dividing the total amount placed in a pool by the amount predicted on each outcome**.
### ^**A]**** Odds Calculation & Payout Distribution** To calculate pari-mutuel odds, users mainly need to consider two primary factors : * **The total amount of funds collected in the pool** * **The proportional distribution of the pool** {% hint style="success" %} ***Note：***The payout and odds users receive are mainly determined by the total funds in each outcome pool and their proportional distribution {% endhint %} ### ^**B]** 🧾 **Payout Distribution** — rewards are calculated based on the following formula: ``` User Payout = ( User Contribution ÷ Total Contributions on Correct Outcome ) × Total Pool Amount × ( 1 – Fee Rate ) ``` **User Payout = ( User Contribution ÷ Total Contributions on Correct Outcome ) × Total Pool Amount × ( 1 – Fee Rate )**\
#### **Formula Explanation:** * **Total Pool Amount:** The **total sum of all funds wagered** by all participants across all outcomes * **Total Contributions on Correct Outcome:** The total amount wagered on the **outcome that ultimately wins/correct**. * **User Share Ratio:** ***User’s Contributed Amount / Total Contributions on the Winning Outcome*** — this represents the user’s **proportional share** within the winning group * **Fee Rate:** The **percentage of fees deducted** from the total payout. {% hint style="success" %} Fee **:** The claiming process is calculated with a 10% fee applied {% endhint %} ### ^**C]**** Illustrative Example: How It Works** #### **1. The Market Question** > **Which team will win the match?**\ > **Prediction Options:** **Team A** | **Team B**

**Your Action:** You placed a **500 USDT** bet on **Team B**.
### ^**D]**** Funds Distribution：** \ 💰**Total Pool:** 10,000 USDT\

Option — Team A Wins: 6,000 USDT\

Option — Team B Wins: 4,000 USDT\ 🏁 **Event Result:** Team B won the match. **✪Your claim：( 500/4,000 )\*10,000\*（1-10%）=1,125 USDT** **Q1：Why can't I sell my position on Pari-mutuel markets?**\ ❖ Pari-mutuel markets are designed with **a pooled contribution mechanism**, dynamic odds, and post-event prize distribution.\ Since there is **no real-time trading price or liquidity counterparty** in this market structure, it is not possible to sell or exit positions early without compromising **fair and transparent** settlement. ***