Economy|$328.8k Vol|
12 days 7 hrsWill __ ships transit the Strait of Hormuz on any day in March? - AI Odds Analysis
All
Outcomes
Market
Price
AI Fair
Value
Value
Edge
40+
YesNo
60+
YesNo
80+
YesNo
20+
YesNo
AI Insights:
03.17 07:31 UpdatedFair Value Reasoning:
While the '20+' option has seen a slight rebound in the last two days (33.5c -> 39.5c), possibly reflecting speculative hopes for 'limited convoys' or 'localized de-escalation', the fundamentals remain dire. With only 14 days left in March, IMF data shows daily transits stuck at 2-8 ships (5-15% of normal). Triggering the '20+' threshold requires tripling the current volume; while theoretically possible, it is statistically unlikely. Triggering 40+, 60+, or 80+ would require a miraculous, instantaneous geopolitical reversal. Given the logistical lag in shipping schedules and insurance, a return to these levels within the remaining window is virtually impossible. Thus, fair values for higher-tier options should be near zero.
Sign up to view more information
Arbitrage|Low Risk
Arbitrage Plan:
Buy 'No' on the '80+' option
Plan Description:
This is a classic 'Low Risk Yield' opportunity. The current 'Yes' price for the 80+ option is 9.5c (implying a 'No' price of 90.5c). With 'Operation Epic Fury' and the blockade ongoing, and daily transits in single digits (<10), a recovery to 80 ships (60% of normal) within the next 13 days is virtually impossible. This 9.5c premium represents market inefficiency; buying 'No' and holding to maturity offers a very high annualized yield on a scenario that is fundamentally dead.Sign up to view more information
Arbitrage: 9¢
|Annualized yield: 270.5%
Rule Risk
High resolution risk exists due to the reliance on IMF Portwatch, which depends on AIS signals. In the current (March 2026) conflict scenario, vessels are highly likely to turn off AIS ('going dark') to evade targeting. This creates a disconnect where physical transits may occur but are not recorded by the resolution source, potentially forcing a 'No' outcome. Additionally, IMF data has a reporting lag (weekly updates) and is subject to revisions, adding volatility to the settlement process.
Exotics
While Strait of Hormuz traffic is a standard geopolitical metric, predicting the exact daily number of ship transits during a specific war month is a deep macro-event prediction. It requires synthesizing military actions (mining, interceptions) with commercial shipping decisions, making it more complex and niche than standard election or sports markets.
Hedging
Crude Oil
US 10Y Yield
Gold
FRO
This event has an extreme negative correlation with global energy prices. A collapse in transit numbers (resolving 'No') implies a blockade, causing a structural shock to Crude Oil prices (Score 5). Tanker stocks (e.g., FRO) would experience significant volatility due to spiking freight rates (war risk premiums). Additionally, inflationary expectations would push up US 10Y Yields, and Gold would benefit as a safe haven. This is a classic 'macro hedge' event.
Divergence
Significant divergence exists. Real-world data (IMF Portwatch) indicates the Strait is effectively 'closed' (2-8 ships/day), reflecting an extreme war scenario. However, the prediction market's higher-tier options (like 80+) still retain a nearly 10% implied probability. This suggests some capital is betting on an 'extreme black swan' such as a data error or sudden ceasefire. In contrast, mainstream maritime analysts have downgraded the probability of shipping returning to normal in March to 'extremely low'.
