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Extension of Arbitrage agent - use conditional probabilities between markets as part of arbitrage strategy #486

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gabrielfior opened this issue Oct 9, 2024 · 1 comment

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@gabrielfior
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On gnosis/prediction-market-agent#137 a simple Arbitrage agent was developed, allowing markets (on the same platform, Omen) to be arbitraged when correlation between them was close to 1 or -1.

We can expand that approach for the case where correlation (which can also be seen as P(A|B), i.e. likelihood that event A occurs if B also occurs) lies somewhere -1 < c < 1.
Some math calculations are available here (notion link).

@gabrielfior
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Moved this ticket to gnosis/prediction-market-agent#508

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