Strategy 1: Cross-Platform Arbitrage
The most straightforward strategy: find the same event priced differently across platforms and trade both sides. PredRadar's arb scanner identifies these opportunities in real time, showing the spread in basis points after fees.
Key requirements: accounts on multiple platforms, sufficient capital on each, and the ability to execute quickly before spreads close.
Strategy 2: Event-Driven Trading
Trade ahead of known catalysts that will move prices. Economic data releases (CPI, jobs numbers), political events (debates, elections), and crypto milestones (halvings, ETF decisions) all create predictable volatility.
The edge comes from better analysis of how the event will resolve, not just whether it will happen. Markets often underprice the magnitude of moves around events.
Strategy 3: Market Making
Place simultaneous buy and sell orders to capture the bid-ask spread. Successful market making requires:
1. Deep understanding of the event's true probability
2. Ability to adjust quotes quickly as new information arrives
3. Sufficient capital to handle inventory risk
4. Algorithms or tools to automate quote management
Strategy 4: Contrarian Value
Markets sometimes overshoot in response to news. When sentiment pushes a contract to an extreme (below 5¢ or above 95¢), the risk/reward often favors the contrarian position. A 3¢ contract that has a true 10% chance of resolving Yes offers a 3.3x expected return.
Strategy 5: Portfolio Diversification
Rather than betting on single events, construct a portfolio of uncorrelated prediction market positions. Spread capital across different categories (politics, crypto, economics, sports) to reduce variance while maintaining positive expected value.
Risk Management
Position sizing: Never put more than 5-10% of your bankroll on a single contract.
Correlation awareness: Multiple crypto contracts may all move together — treat them as a single risk.
Liquidity risk: Check the order book depth before entering large positions. Thin markets can trap capital.
Time value: Capital locked in a 90¢ contract for 6 months earns less than risk-free rates. Factor in opportunity cost.