How to arbitrage Kalshi and Polymarket against sportsbooks
Prediction market arbitrage means buying a contract on an exchange like Kalshi or Polymarket and betting the opposite result at a sportsbook or another exchange, so every outcome pays back more than you staked. A contract's price in cents is its implied probability, so a 44¢ contract is +127 in American odds. Exchange fees are the catch: Kalshi's standard fee peaks at 1.75¢ per contract, enough to halve a typical edge. Arbocado's Arbitrage Finder scans Kalshi, Polymarket, and four other exchanges alongside the sportsbooks.
- A prediction market contract pays $1 if it wins, so its price in cents is its implied probability: 44¢ means 44%, or +127 in American odds.
- Kalshi's standard taker fee is 0.07 × contracts × price × (1 - price), rounded up to the next cent, which peaks at 1.75¢ per contract at a 50¢ price.
- After Kalshi's fee, a 44¢ contract costs about 45.7¢, which moves its odds from +127 to about +119.
- An exchange-vs-sportsbook arb is real only if the fee-adjusted contract price plus the sportsbook's implied probability comes to less than 100%.
- Exchanges earn fees on volume instead of taking the other side of your bet, so they have no reason to limit winning accounts the way sportsbooks do.
The short answer
Yes, you can arbitrage a prediction market like Kalshi or Polymarket against a sportsbook. Buy the contract for one team on the exchange, bet the other team at the sportsbook, and size both so either result pays back more than you put in.
Once you turn the contract price into odds, the math is the same as any arb. The difference is the fee. Exchanges charge per contract, and on a thin edge that fee can take half your profit or all of it.
Why arbers add prediction markets
- Different prices. Sportsbook traders set their own lines. Exchange prices come from other traders' orders, so they often lag or lead the books by a few cents. Those gaps are where arbs show up.
- No reason to limit you. An exchange matches you against other traders and earns a fee on volume. It doesn't lose when you win, so it has no reason to cap a winning account the way a sportsbook does. See how sportsbook limits work for why that matters.
- You can sell early. A contract can be sold back to the market before the game ends, at whatever price other traders will pay. A sportsbook bet is locked unless the book offers a cash-out.
How a contract price turns into odds
A prediction market contract pays $1 if its outcome happens and $0 if it doesn't. That makes the price an implied probability. A Knicks contract at 44¢ means the market gives the Knicks a 44% chance.
Contract price to decimal odds
decimal odds = $1 ÷ price
Contract price to American odds, under 50¢
American odds = +100 × (1 - price) ÷ price
Contract price to American odds, over 50¢
American odds = -100 × price ÷ (1 - price)
| Price | Implied | Decimal | American |
|---|---|---|---|
| 10¢ | 10% | 10.00 | +900 |
| 25¢ | 25% | 4.00 | +300 |
| 44¢ | 44% | 2.27 | +127 |
| 50¢ | 50% | 2.00 | +100 |
| 60¢ | 60% | 1.67 | -150 |
| 75¢ | 75% | 1.33 | -300 |
You can skip the conversion. Arbocado's arb bet calculator has an implied probability format, so a 44¢ contract goes in as 44.
Fees decide whether the arb is real
Sportsbooks build their cut into the odds. Exchanges show a cleaner price and charge a fee on top when your order fills. Kalshi's standard fee for an order that takes a price already on the board is:
Kalshi taker fee
fee = 0.07 × contracts × price × (1 - price), rounded up to the next cent
The fee peaks at 1.75¢ per contract at a 50¢ price and shrinks toward either end. As a share of what you pay, it hits longshots hardest.
| Price | Fee per contract | Fee as % of price | Odds before fee | Odds after fee |
|---|---|---|---|---|
| 10¢ | 0.63¢ | 6.3% | +900 | +841 |
| 25¢ | 1.31¢ | 5.3% | +300 | +280 |
| 44¢ | 1.73¢ | 3.9% | +127 | +119 |
| 50¢ | 1.75¢ | 3.5% | +100 | -107 |
| 60¢ | 1.68¢ | 2.8% | -150 | -161 |
| 75¢ | 1.31¢ | 1.8% | -300 | -322 |
The rounding happens once per order, so small orders pay more. One contract at 44¢ carries a full 2¢ fee instead of 1.73¢.
Worked example: Kalshi vs. DraftKings
Knicks at Celtics. Kalshi has a Knicks contract at 44¢. DraftKings has the Celtics at -110, which is 52.38% implied. Before fees, 44% plus 52.38% is 96.38%. That looks like a 3.8% arb.
Now add the fee. 200 contracts at 44¢ cost $88.00, and the fee is 0.07 × 200 × 0.44 × 0.56 = $3.45 (rounded up from $3.4496). You pay $91.45, or 45.725¢ a contract, for $200 if the Knicks win. To get $200 back if the Celtics win, you bet $104.76 at DraftKings.
| Result | You get back | You staked | Profit |
|---|---|---|---|
| Knicks win | $200.00 from Kalshi | $196.21 | $3.79 |
| Celtics win | $200.00 from DraftKings | $196.21 | $3.79 |
That's a 1.93% return. Without the fee the same arb would have made $7.24, so the fee took almost half.
Below, the Kalshi leg is entered as 45.725, the fee-adjusted price, in implied odds. Change the prices or the stake to test your own numbers.
Kalshi vs. DraftKings after fees
Knicks at 44¢ plus Kalshi's fee (45.725¢ a contract) vs. Celtics -110 at DraftKings, with the Kalshi leg locked at $91.45.
Guaranteed profit $3.79 (1.93%) whichever outcome wins
Arbing two prediction markets
You can also pair two exchanges. Buying the Knicks on one and the Celtics on another works like buying YES and NO on the same game. Each pair pays $1, whichever team wins.
Exchange vs. exchange arb
YES price + NO price + both fees < $1.00
Say Kalshi has the Knicks at 44¢ and Polymarket US has the Celtics at 53¢. That's 97¢ for a $1 payout, 3¢ of room. Kalshi's fee at 44¢ is about 1.73¢. If the other side paid the same rate at 53¢ (about 1.74¢), the pair would cost 100.47¢ and lose money.
Two fees stack, so these arbs need a wider gap than an exchange paired with a sportsbook. Near even prices, the gap has to beat about 3.5¢ when both sides pay taker fees. Maker orders, where they're free, shrink that hurdle.
Risks that work differently on an exchange
- Thin order books. The price on screen covers a set number of contracts. Buy more and the rest fills at worse prices, which can erase the edge. Check depth before you size the arb.
- Partial fills. A limit order for 200 contracts might fill 120. Size the sportsbook bet to what filled, not what you ordered.
- Different settlement rules. Every contract has written rules for overtime, postponements, and cancellations. A sportsbook might void a postponed game while the contract stays open or settles another way. Read both sets of rules before you bet.
- State availability. Kalshi is regulated by the CFTC and offers sports contracts in many states, including some without legal sportsbooks, but several states have challenged that in court. Polymarket's main site doesn't serve U.S. users. Polymarket US is its regulated U.S. version. See is arbitrage betting legal for the sportsbook side.
- Money moves differently. Deposit methods and withdrawal times differ from sportsbooks. Treat each exchange as one more balance to plan around, as in building an arbitrage bankroll.
How to find and place one
- 1
Pick your exchanges and books
In the prediction markets arbitrage finder, choose your state and every exchange and sportsbook you have an account with. Arbocado scans Kalshi, Polymarket, Polymarket US, Crypto.com, NoVig, and ProphetX next to the sportsbooks. - 2
Add the fee
Add the fee per contract to the exchange price and run the new number through the calculator. If the arb no longer adds up to under 100%, skip it. - 3
Check depth and rules
Make sure enough contracts sit at your price for the size you want, and that both sides settle the same way on overtime and postponements. - 4
Place the exchange order first
Use a limit order at your price. Once it fills, you know how many contracts you hold and what they pay. - 5
Bet the sportsbook side
Size the stake so it returns the same amount as your filled contracts. On the sportsbook side, automated arbitrage betting with Arbocado Pro fills the bet slip and re-sizes it if the line moves, and you confirm the bet. Exchange orders you place yourself.
Scan Kalshi and Polymarket against the sportsbooks
The Arbitrage Finder checks six prediction markets and exchanges alongside the major U.S. sportsbooks and sizes each leg. Free to try.
Open the Arbitrage FinderFor the stake math behind every arb, see how to calculate arbitrage bets. For which books to pair with an exchange, see the best sportsbooks for arbitrage betting.
Frequently asked questions
Can you arbitrage Kalshi against a sportsbook?
Yes. Buy the Kalshi contract for one side and bet the other side at a sportsbook, sized so both results return the same amount. Add Kalshi's fee to the contract price first. A 44¢ Knicks contract against Celtics -110 at DraftKings looks like a 3.8% arb, but after the fee it returns about 1.9%.
How do you find prediction market arbitrage?
Use an arbitrage bet finder tool that scans exchanges and sportsbooks together, then check each result after fees. Arbocado's Arbitrage Finder covers Kalshi, Polymarket, Polymarket US, Crypto.com, NoVig, and ProphetX alongside the major U.S. sportsbooks and sizes each leg.
Do Kalshi and Polymarket limit winning traders?
Exchanges match you against other traders and make money from fees, so your wins don't cost them anything. That gives them no reason to cut a winning account's stakes the way sportsbooks do. The practical limit on an exchange is order book depth: how many contracts are available at your price.
Is prediction market arbitrage legal?
Kalshi is regulated by the CFTC and offers sports contracts in many U.S. states, though several states have challenged that in court. Polymarket's main site doesn't serve U.S. users, while Polymarket US is its regulated U.S. version. Placing offsetting positions is not illegal anywhere you can legally use both platforms.