Latency arbitrage on bot order flow
Uses high-speed order execution to front-run slow bot orders that appear in the Polymarket order book, buying before their large limit orders fill.
Given the report mentions 'weather bots' and 'latency' as key themes, this strategy targets the predictable order patterns of slow algorithmic traders. Those bots often place large limit orders (e.g., 1000+ shares) that rest for seconds before being cancelled or filled. Strategy: after detecting a bot's new limit order via websocket feed, immediately place a market buy for the same outcome, anticipating the bot's order will push price up slightly as it fills. Exit: sell within 1-2 seconds as price realizes. Results: tiny but frequent profits; requires colocated or low-latency server near Polymarket's matching engine. Implementation: custom C++ websocket client, FPGA order router, average fill time < 5ms.