> For the complete documentation index, see [llms.txt](https://docs.butter.markets/llms.txt). Markdown versions of documentation pages are available by appending `.md` to page URLs; this page is available as [Markdown](https://docs.butter.markets/welcome/what-are-conditionals-1.md).
# What are conditionals?
{% hint style="info" %}
**Definition.** Conditionals are **event futures** whose payout is the value of a datapoint (**asset price, index, KPI**) *conditional on the outcome* of an event.
{% endhint %}
Each conditional market has one branch per mutually exclusive outcome. The branch price reflects the market's forecast of the asset's value if that outcome occurs.
### Examples
One example is a BTC *conditional* on a Fed cut, hold, or hike outcome.
One example is an S\&P 500 *conditional* on a candidate A win, candidate B win, or candidate C win outcome.
One example is an AAPL *conditional* on an earnings beat, inline, or miss outcome.
### How it works
* **Shared collateral:** One deposit supports all branches simultaneously.
* **Deterministic resolution:** Non-realized branches are cancelled; the realized branch settles to the observed asset price.
* **No liquidations:** Positions are fully collateralized by conditional USDC within each branch.
### Trading conditionals
Your goal is to form your own forecast of the asset's price in each outcome branch, compare it with the branch's current price, and decide whether to go long or short.
See [How to trade](/user-guide/how-to-trade.md) for a step-by-step walkthrough.
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