I can confirm that this arbitrage opportunity exists and works as described. At the time of this writing, the sum of all Nos for the EC market is $14.70, and running the loop up to 850 shares turned $1000 into $1078. Depending on which contract actually resolves Yes, there’s an additional payout of a few bucks.
The way PredictIt calculates risk and payouts for multi-contract markets seems very confusing and is making my head hurt a bit. My Max Payout for the market is $850, but I have no idea how this number was calculated, and it doesn’t make any sense—my understanding is that the real max payout is the largest potential payout across the market’s contracts, which is a much smaller $13.
If anyone can explain how these multi-contract markets actually work, I’m all ears!
I think Predictit pays on arbitrage according to the assumption that at most one bucket resolves to yes, but not according to the assumption exactly one bucket resolves yes, so that 850 is in the hypothetical world where none of the 16 buckets resolve to yes.
I can confirm that this arbitrage opportunity exists and works as described. At the time of this writing, the sum of all Nos for the EC market is $14.70, and running the loop up to 850 shares turned $1000 into $1078. Depending on which contract actually resolves Yes, there’s an additional payout of a few bucks.
The way PredictIt calculates risk and payouts for multi-contract markets seems very confusing and is making my head hurt a bit. My Max Payout for the market is $850, but I have no idea how this number was calculated, and it doesn’t make any sense—my understanding is that the real max payout is the largest potential payout across the market’s contracts, which is a much smaller $13.
If anyone can explain how these multi-contract markets actually work, I’m all ears!
I think Predictit pays on arbitrage according to the assumption that at most one bucket resolves to yes, but not according to the assumption exactly one bucket resolves yes, so that 850 is in the hypothetical world where none of the 16 buckets resolve to yes.