Arbitrage Trading

One of the most powerful features of Oraclyst is the ability to capitalize on market inefficiencies. Because prediction markets are fragmented, different platforms often assign different probabilities to the exact same event. This creates Arbitrage Opportunities.

The Arbitrage Scanner

The Arbitrage Scanner is a specialized tool within the Oraclyst terminal that filters thousands of markets to find "Negative Risk" trade setups.

The Logic of Prediction Arbitrage: In a binary market, the price of "YES" plus the price of "NO" should always equal $1.00.

• Perfect Efficiency: Price(YES) $0.60 + Price(NO) $0.40 = $1.00.

• Arbitrage Opportunity: Price(YES on Venue A) $0.55 + Price(NO on Venue B) $0.40 = $0.95.

How to Execute a Risk-Free Trade:

1. Locate the Signal: Look for the gold-highlighted rows in the Event Ticker or the dedicated Arbitrage tab.

   • Signal Example: "US Election: Poly YES (52¢) / Kalshi NO (43¢) -> Cost 95¢".

2. Analyze the Spread: The scanner calculates the Guaranteed ROI. In the example above, you pay 95 cents to receive a guaranteed payout of $1.00 (regardless of who wins). This is a 5.26% instant return.

3. Click "Auto-Hedge":

   • Oraclyst offers a one-click execution button for these scenarios.

   • When clicked, the Smart Router simultaneously buys the YES position on Polymarket and the NO position on Kalshi.

4. Hold to Maturity: You will hold two SOTs: SOT-POLY-YES and SOT-KALSHI-NO.

5. Settlement:

   • If the event happens (YES wins): Your Poly token pays $1.00. Your Kalshi token pays $0.00.

   • If the event does not happen (NO wins): Your Poly token pays $0.00. Your Kalshi token pays $1.00.

   • Result: In either case, you redeem $1.00 for every $0.95 spent.