Polymarket Arbitrage

Find and execute arbitrage opportunities on Polymarket prediction markets.

Quick Start

1. Paper Trading (Recommended First Step)

Run a single scan to see current opportunities:

cd skills/polymarket-arbitrage
pip install requests beautifulsoup4
python scripts/monitor.py --once --min-edge 3.0

View results in polymarket_data/arbs.json

2. Continuous Monitoring

Monitor every 5 minutes and alert on new opportunities:

python scripts/monitor.py --interval 300 --min-edge 3.0

Stop with Ctrl+C

3. Understanding Results

Each detected arbitrage includes:

• net_profit_pct: Edge after 2% fees
• risk_score: 0-100, lower is better
• volume: Market liquidity
• action: What to do (buy/sell all outcomes)

Good opportunities:

• Net profit: 3-5%+
• Risk score: <50
• Volume: $1M+
• Type: math_arb_buy (safer)

Arbitrage Types Detected

Math Arbitrage (Primary Focus)

Type A: Buy All Outcomes (prob sum < 100%)

• Safest type
• Guaranteed profit if executable
• Example: 48% + 45% = 93% → 7% edge, ~5% net after fees

Type B: Sell All Outcomes (prob sum > 100%)

• Riskier (requires liquidity)
• Need capital to collateralize
• Avoid until experienced

See references/arbitrage_types.md for detailed examples and strategies.

Cross-Market Arbitrage

Same event priced differently across markets (not yet implemented - requires semantic matching).

Orderbook Arbitrage

Requires real-time orderbook data (homepage shows midpoints, not executable prices).

Scripts

fetch_markets.py

Scrape Polymarket homepage for active markets.

python scripts/fetch_markets.py --output markets.json --min-volume 50000

Returns JSON with market probabilities, volumes, and metadata.

detect_arbitrage.py

Analyze markets for arbitrage opportunities.

python scripts/detect_arbitrage.py markets.json --min-edge 3.0 --output arbs.json

Accounts for:

• 2% taker fees (per leg)
• Multi-outcome fee multiplication
• Risk scoring

monitor.py

Continuous monitoring with alerting.

python scripts/monitor.py --interval 300 --min-edge 3.0 [--alert-webhook URL]

Features:

• Fetches markets every interval
• Detects arbitrage
• Alerts on NEW opportunities only (deduplicates)
• Saves state to polymarket_data/

Workflow Phases

Phase 1: Paper Trading (1-2 weeks)

Goal: Understand opportunity frequency and quality

1. Run monitor 2-3x per day
2. Log opportunities in spreadsheet
3. Check if they're still available when you look
4. Calculate what profit would have been

Decision point: If seeing 3-5 good opportunities per week, proceed to Phase 2.

Phase 2: Micro Testing ($50-100 CAD)

Goal: Learn platform mechanics

1. Create Polymarket account
2. Deposit $50-100 in USDC
3. Manual trades only (no automation)
4. Max $5-10 per opportunity
5. Track every trade in spreadsheet