One way to think about the bid-ask spread, is that while orthonormal’s current probability is 10%, he’d consider someone offering to bet him actual money on one side or the other to be sufficient evidence to adjust his belief significantly in that direction.
One way to think about the bid-ask spread, is that while orthonormal’s current probability is 10%, he’d consider someone offering to bet him actual money on one side or the other to be sufficient evidence to adjust his belief significantly in that direction.