News arbitrageurs focus on speed and information timing. They monitor news sources, official announcements, data releases, and credible leaks, then trade as soon as new information appears. Their goal is to enter the market before probabilities fully adjust, capturing value from temporary mispricing.
In prediction markets, news arbitrageurs play an important corrective role. On platforms like Polymarket, Kalshi, Myriad, and Manifold, they are often the first to move prices after breaking news. Their trades push probabilities toward more accurate levels, helping the market reflect reality faster. This behavior shows up in prediction markets data as sharp, early movements that precede broader market participation.
While they profit from speed, news arbitrageurs also improve overall forecast quality by reducing information latency and correcting outdated prices.
News arbitrageurs help prediction markets stay responsive and accurate. Their activity improves the quality of prediction markets data by ensuring prices reflect new information quickly.
They reduce the delay between real-world events and market updates. Without them, markets might react slowly, leaving probabilities stale for longer periods. News arbitrageurs help ensure prediction markets data reflects current reality rather than outdated assumptions.
They create the first wave of price adjustment after news breaks. Other traders then follow, adding liquidity and refining the probability further. Analysts often see this in prediction markets data as an initial sharp move followed by smoother convergence toward a new consensus.
Analysts can identify which news sources move markets fastest, measure information latency, and distinguish early informed moves from later crowd reactions. Studying these patterns helps explain how prediction markets data incorporates information over time.
A sudden regulatory announcement is released early in the day. On Polymarket, a small group of traders reacts within minutes, pushing the probability sharply in one direction. As the news spreads more widely, additional traders enter, confirming the move and stabilizing the forecast.
Analyzing news arbitrage requires high-resolution, time-stamped market data. FinFeed's Prediction Markets API provides detailed prediction markets data—live probability updates, historical price paths, and liquidity signals—that help developers and analysts study how fast markets react to news and how information spreads through prices.
