FireFly

Cross Prediction Markets Arbitrage. Strategies. Risks. Tools. This is one of the most popular and most discussed types of arbitrage among traders. 1. The Core Arbitrage Strategy: > We look for a price difference between the same outcome on different prediction markets > We buy opposite outcomes on different platforms > Any outcome win = profit 2. How to find trades It is very important that the markets you choose have good volume compared to your position size. Low-liquidity markets can become a problem and add extra risk. By using tools (listed below), we can find the same markets on different platforms and compare prices. The goal is to get one condition: YES (pm1) + NO (pm2) < $1 The bigger the gap (1 - sum of outcomes), the higher your profit. You do not need to wait for the market to resolve. You can already be in profit if the spread becomes smaller. For example: If you bought at 45c and 50c, and later prices move to 50/50, you are already in profit. There is no need to wait for 100/0 or 0/100. 3. Risks of This Arbitrage Strategy: Main risks to keep in mind: > Limit orders risk. it is important. If the market is very volatile, you may fill one side, while the limit order on the other market does not fill. Always check bid/ask spread. See if you can enter with limits below market price or use market buy if needed. > Resolution source risk. If platforms use different sources or interpret results differently, there is a rare case where same outcomes can lose on different platforms. > Rule differences. Sometimes markets look the same, but rules are written differently. This can lead to mistakes if not checked carefully. > Liquidity risk. Low liquidity makes it hard not only to enter, but also to exit. You may get stuck in a position and be forced to wait for resolution or more volume. > Fees. Some prediction markets charge fees, which can eat part of your profit. 4. Toolkit for arbitrage @securezer0 — one of the most useful arbitrage parsers across different prediction markets. Very handy and has more features. @PredictionHunt — cross-market arbitrage parser. @ArbBets20 — cross-market arbitrage parser. There are other tools as well but these are some of the top ones.