No-Arbitrage Cross-Market Arbitrage
Hunts no-arbitrage violations between related election markets, sizes positions with fractional Kelly, and requires a backtested out-of-sample edge.
This strategy identifies mispricings across correlated political prediction markets on Polymarket. The bot scans for no-arbitrage violations between related election markets, meaning when the combined implied probabilities of mutually exclusive outcomes differ from 100%. It enters positions to capture the mispricing and sizes bets using fractional Kelly criterion to optimize long-term growth while managing risk. The system trades only when it has a backtested out-of-sample edge, emphasizing survival over profit. Implementation is process-first, using quantitative analysis to validate opportunities before execution. Paper-trading by default, it refuses to trade without confirmed statistical edge.