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Criteria current as of: July 2026 Markets enter a Belief Index series by passing a published, rules-based screen – not because someone liked them. This page specifies the eligibility criteria a prediction market must meet to enter a series, and the formula that determines how much weight it carries once admitted.
This page covers which markets enter an index and at what weight. For how admitted markets are valued, see NAV Methodology. For how composition evolves over time, see Perpetual Series.
Published for transparency, not as a binding commitment. These criteria describe how Belief Systems currently constructs and reconstitutes its indices. They are forward-looking guides: Belief Systems may revise them, or depart from them in a specific case, at its discretion. Some live series also predate the current rule set, so readers may observe compositions that would not result from applying today’s criteria – that drift is expected, not an error.

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One Rule Set, Applied Twice

There are two moments a market can enter a series:
  1. At series creation, when the initial composition is assembled.
  2. At reconstitution, when a Perpetual series adds markets on its published review cadence.
Both paths read from a single canonical rule set – the same thresholds, the same weighting formula. A market that qualifies at creation would qualify at reconstitution, and vice versa. Any divergence between the two paths is treated as a defect, not a feature. This is the same discipline that makes an equity index investable: the rules are the methodology, and the methodology does not bend per event.

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Eligibility Screens

A candidate market must pass every screen below. These are hard thresholds, applied identically to every candidate.
Thresholds are stated as current values. They are revised deliberately and prospectively – see How Thresholds Are Set below. A revision never retroactively changes an existing composition.

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Judgment Screens

Quantitative screens establish that a market is investable. A second set of screens, applied through human review, establishes that it belongs: A series targets 5 to 20 constituent markets. Below five, a single market’s resolution moves the index too violently for “diversified” to mean anything. Above roughly twenty, additions tend to either duplicate existing exposure or reach below the quality bar. A narrow theme with seven strong candidates makes a perfectly good basket; a broad theme with thirty is trimmed for clarity.

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Weighting

Admitted markets are weighted by a published formula rather than discretion:
In plain English: a market earns weight by being both deep and actively traded. The geometric mean means neither input can carry the other – a deep but dormant market, or a busy but shallow one, earns less weight than a market that is both. The square root dampens outliers so a single very large market cannot mechanically dominate the basket. Two adjustments are applied to the natural weights:
1

Concentration cap – no market above 50%

Any market whose weight exceeds 50% is capped there, and the excess is redistributed proportionally across the uncapped markets. This repeats until no market is over the cap. The cap is anti-concentration: an index should never be one market wearing a costume.
2

Investability floor – no market below 1%

Any market whose natural weight computes below 1% is excluded entirely and the survivors are renormalized. This is an inclusion rule, not a weight clamp – survivors keep their relative weights. The floor is anti-fragmentation: a position too small to hold materially adds operational surface without adding meaningful exposure.
Final weights are normalized to sum to exactly 1.0. Both inputs – depth and volume – are observed at composition time, so weights are a point-in-time snapshot. They do not drift with market conditions between reconstitutions; see Known Limitations in NAV Methodology.
Three candidate markets pass all eligibility screens:Market A’s natural weight (68.2%) exceeds the 50% cap. It is capped at 50%, and the remaining 50% is split between B and C in proportion to their raw scores:No market falls below the 1% investability floor, so no exclusions apply. In a larger basket, a market whose natural weight computed to, say, 0.4% would be dropped and the remaining weights renormalized.
Each series records its weighting scheme in its methodology, displayed on the series detail page. The formula above is the standard scheme for series created and reconstituted under the current methodology; some earlier series record a simpler scheme, such as equal weighting.

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How Thresholds Are Set and Revised

The numeric thresholds are not arbitrary. They are derived empirically from the distribution of markets actually held by live Belief indices – anchored near the conservative end of that distribution, so the screens encode what has historically made a good constituent rather than a hopeful guess. Revisions follow the same discipline as the rest of the methodology:
  • Thresholds are reviewed on a deliberate cadence, not tuned ad hoc.
  • Any revision applies prospectively – to future selections, never to existing compositions.
  • The current values are published on this page, and the “current as of” date at the top reflects the last review.

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What These Rules Do Not Decide

  • Removals. Markets are never removed by discretion. Constituents exit a series only by resolving – see Perpetual Series for how settled markets leave the basket.
  • Valuation. How an admitted market is priced into NAV is specified separately in NAV Methodology.

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Further Reading

Perpetual Series

How composition evolves through reconstitution, and how costs are disclosed.

NAV Methodology

How constituent prices become an index level – transparent and replicable.

Index Series

Foundational concepts: composition, normalization, lifecycle.

Risk Factors

Risks including concentration, correlation, resolution, and reconstitution.