Polymarket Arbitrage Calculator

Arbitrage on Polymarket means locking in a guaranteed profit by exploiting price differences across platforms or within the same market.

From April 2024 to April 2025, on-chain data from 95 million transactions showed that arbitrageurs extracted over $40 million in risk-free profits from Polymarket, with the top three wallets alone earning $4.2 million.

This guide breaks down every major arbitrage strategy, shows you exactly how to calculate whether an opportunity is truly profitable after fees, and gives you a free interactive calculator to run the numbers instantly.

What Is Prediction Market Arbitrage?

Prediction market arbitrage is the practice of placing opposite-side bets on the same event across two or more platforms, or on both sides of a single binary market, in a way that guarantees a return regardless of the outcome.

The core math is simple. In a binary market, a Yes share and a No share together always pay out exactly $1.00 at resolution. If you can buy both for less than $1.00 combined, you profit on every dollar of capital deployed.

The strategy does not require you to predict the outcome. It only requires you to find and act on a mispricing before it closes.

The 5 Types of Polymarket Arbitrage

Polymarket arbitrage is not a single strategy. There are five distinct models, each with different barriers and risk profiles.

1. In-Platform “Risk-Free” Arbitrage

This is the purest form. Within a single binary market on Polymarket, you buy both the Yes and No shares. If their combined price is below $1.00, the position is self-hedging and resolves at a guaranteed profit.

Formula:

Gross Profit per Share = $1.00 – Yes Price – No Price
Net Profit = Gross Profit – Taker Fee (Yes leg) – Taker Fee (No leg)

Example: Yes is priced at $0.46, No is priced at $0.51. Combined cost = $0.97. Gross profit = $0.03 per share. After fees at a peak 1.80% dynamic rate, net profit narrows but may remain positive depending on market category.

This space is now dominated by bots that close these gaps within seconds. Manual in-platform arb windows are extremely rare on high-liquidity markets.

2. Cross-Platform Arbitrage (Polymarket vs Kalshi)

Cross-platform arb buys Yes on one platform and No on another for the same event. When Polymarket prices an event at 45 cents Yes and Kalshi prices the equivalent No position at 52 cents, buying both costs $0.97 for a $1.00 payout.

A real documented case: the question “Will Bitcoin break $95,000 within an hour?” showed a Yes price of $0.45 on Polymarket while the equivalent No on Kalshi was $0.48, creating a gross $0.03 spread before fees.

Critical risk: Both platforms must resolve the event identically. If their oracle sources or resolution criteria differ even slightly, what appears to be a hedge becomes two directional bets that can both lose.

3. Information Arbitrage

Information arb involves acting on faster data than the rest of the market. Traders using live sports APIs, real-time news feeds, or on-the-ground sources place orders before Polymarket prices update. Automated systems executing over 10,200 bets generated $4.2 million in profits this way in 2024 to 2025.

This strategy is not truly “arbitrage” in the risk-free sense. It is an information edge trade. The profit comes from being faster, not from mathematical lock-in.

4. Negative Risk Arbitrage

In markets with multiple mutually exclusive outcomes (A wins, B wins, or C wins), the sum of all outcome probabilities must equal 100%. When mispriced markets price all outcomes above 100% combined, you can take No positions across all outcomes and guarantee a profit regardless of which outcome resolves.

This requires deeper market analysis but is one of the most overlooked opportunities for retail traders.

5. Endgame / Near-Certain Arbitrage

Buying shares priced at $0.95 to $0.99 in markets very close to resolution can generate annualized returns that exceed most other strategies when capital is recycled quickly. The individual gain per trade is tiny (1 to 5 cents) but the annualized yield on deployed capital can reach 15 to 40% when trades resolve within days.

Cross-Platform Arb: The Step-by-Step Process

Cross-platform arbitrage between Polymarket and Kalshi is the most accessible strategy for retail traders because it does not require bots or programming skills.

Step 1: Find a matching market on both platforms. Both platforms must be trading the same real-world event with the same binary outcome and the same resolution criteria.

Step 2: Record both prices. Note the best Yes ask on one platform and the best No ask on the other. You need the price you will actually pay, not the midpoint.

Step 3: Run the net profit formula:

Arbitrage Profit = $1.00 – (Yes Price + No Price) – Platform A Taker Fee – Platform B Taker Fee

Step 4: Check settlement alignment. Read both platforms’ resolution rules. If Polymarket resolves based on CoinGecko and Kalshi resolves based on Coinbase, a crypto price event could resolve differently on each.

Step 5: Execute simultaneously. Execute both legs as close to the same moment as possible. Any delay exposes you to leg risk, where one side fills and the other price moves against you before the second fill.

Fee Impact: Why Gross Arb Is Not Net Arb

This is where most beginners lose money. A 3% gross spread sounds profitable until fees consume it entirely.

Platform	Fee Type	Rate
Polymarket (Global)	Dynamic taker fee	Up to 1.80% of trade value
Polymarket US (DCM)	Flat taker fee	0.30%
Kalshi	Taker fee	~0.70%
PredictIt	Winnings fee	10% of profit

Example where gross arb fails: Polymarket Yes at $0.58, Kalshi No at $0.38. Combined cost = $0.96. Gross spread = $0.04. Polymarket taker fee (1.5%) = ~$0.009. Kalshi taker fee (0.7%) = ~$0.003. Net profit = $0.04 – $0.012 = $0.028. On a $1,000 stake, that is only $28 before gas costs and any slippage. Whether this is “worth it” depends entirely on execution speed and capital efficiency.

Use the calculator below to test any combination instantly.

Key Risks of Polymarket Arbitrage

Arbitrage is often described as “risk-free” but that description requires several assumptions to all hold true simultaneously.

• Settlement risk: The single biggest risk in cross-platform arb. If one platform resolves YES and the other resolves NO, you lose on both legs.

• Leg risk: The time between executing Leg 1 and Leg 2 exposes you to price movement. In volatile markets, the second leg may no longer be profitable by the time you fill it.

• Liquidity risk: Large arb positions move the market. Buying 10,000 Yes shares shifts the price upward, narrowing or eliminating the spread before your order fully fills.

• Capital lockup: Funds are tied up until market resolution. A 2% arb on a market that takes 90 days to resolve is a poor annualized return compared to other opportunities.

• Counterparty and oracle risk: Polymarket uses UMA oracle. Kalshi uses their own internal resolution. These can and do differ.

Frequently Asked Questions