Prediction markets versus sportsbooks
One quotes you a margin. The other charges you a fee. They are not the same number and they do not behave the same way.
The interfaces look similar and the cost structures are not. Knowing which one you are paying changes which trades are worth taking, and it is the single most common thing people get wrong when they move between the two.
The sportsbook model
A book quotes both sides with a margin baked in. Two sides at −110 imply 52.38% each; together, 104.76%. The book keeps 4.55% of turnover if it balances. You never see it as a charge because it is inside the price — which is precisely why it is easy to underestimate. To recover what the book actually believes you have to strip it out.
The prediction-market model
An exchange matches you against another trader. On Polymarket a binary market’s two sides are the two halves of one token pair, so they sum to about $1 and there is no bookmaker margin in the quote at all. What you pay is the bid-ask spread plus, as a taker, a fee computed by category: fee = C × feeRate × p × (1 − p). Makers pay nothing. Geopolitics markets are fee-free entirely. The full schedule, dated.
Comparing them honestly
On 100 shares of a politics market at 50¢ the taker fee is $1.00 on a $50 position — 2% of stake. A two-way −110 book charging 4.55% of turnover is a different denominator and a different mechanism, so a single-number comparison is always a little dishonest. The comparable question is the one that decides trades either way: what is my all-in break-even probability? Compute that on both venues and the argument settles itself.
Two structural differences matter as much as the cost. An exchange lets you take either side at a price somebody else is willing to trade, so there is no line to beat — there is only a price to disagree with. And your capital is locked until the market resolves, which is a cost a same-day bet does not have. Price the wait.
The part nobody enjoys
Neither structure makes you profitable. Lower cost widens the set of trades that could pay; it does nothing about whether your probabilities are better than the market’s. That question is answered by a settled record, not by a fee schedule — and here is what a real one looks like.
Questions
Are prediction markets cheaper than sportsbooks?
They have a different cost structure. A sportsbook builds a margin into both prices; an exchange charges a spread plus, for takers, a category-based fee, with makers paying nothing. The comparable number is your all-in break-even probability on each.
Is there a vig on Polymarket?
Not in the bookmaker sense. A binary market's two sides are one token pair summing to about $1; the cost is the spread and the taker fee.
What is the biggest practical difference?
Capital lockup. On an exchange your money is committed until the market resolves, which is a real cost that a settled-same-day bet does not carry.