Free Money on Prediction Markets: How Arbitrage Traders Win

Prediction markets like Polymarket are leaking money! A new study reveals how arbitrageurs are exploiting mispricings—where odds don't add up—to pocket risk-free profits. From inconsistent yes/no prices to related markets moving out of sync, savvy traders (and their bots) have raked in over $40 million. While this arbitrage ultimately improves market accuracy, it exposes the surprising fallibility of prediction market odds, especially for casual users. The takeaway? Fortunes are being made by those who can spot these fleeting inefficiencies. Hosted on Acast. See acast.com/privacy for more information.