The study examines the discrepancies between binary forecasts and real-world outcomes, revealing their often misleading nature.
problem The confusion between binary forecasts and real-world payoffs in decision-making and prediction.
method Comparative analysis of binary forecasts, bets, and real-world continuous payoffs under different tail conditions.
result Binary forecasting abilities do not translate to better real-world performance, and vice versa, especially under nonlinearities.