Why nobody can take the Iranian Abu Musa island in 28 days

On July 29, American aircraft struck Qeshm Island off Iran's southern coast, killing three civilians. Polymarket's Abu Musa Island market fell 24% instead, to about 2 cents. Here's why we are betting against a change of control to earn about 1.2% by August 31.

The rules ask two things at once. Iran has to stop exercising primary governmental or military control over Abu Musa, and another state, occupying force, or internationally backed authority has to establish control over the island. One without the other settles no.

The rules also list what does not qualify: "Temporary raids, isolated landings, special operations, bombardment, sabotage, naval presence offshore." A claim that Iran has lost the island counts for nothing until somebody is standing on it.

A couple of additional facts:

• Abu Musa is 12.8 square kilometers with about 2,131 people, 70km from Iran and 59km from Sharjah
• Iran and Sharjah signed a memorandum in November 1971 splitting the island's oil money, and Iranian troops landed the next day
• The United Arab Emirates has claimed it since then and wants talks or the World Court
• The Revolutionary Guard navy holds it, with reported anti-ship missiles and radar and underground command rooms
• The American blockade of Iran ran from April 13 to May 29 and seized ships without landing on any island

After reading all of this, one can say that despite the data already heavily favoring No traders, a 1.2% return appears modest. In fact, too modest. However, on an annualized basis, that is 17.04%. It’s much better to slowly grow one’s portfolio than to bet on risky markets where the probability is a coin flip, or sometimes even worse.