polymarket-trading

Polymarket Autonomous Trading Skill

Enable AI agents to autonomously trade prediction markets on Polymarket.

Overview

This skill provides AI agents with the ability to:

• ? Fetch live market data and odds
• ? Place buy/sell orders autonomously
• ? Monitor positions and P&L
• ? Execute trading strategies
• ⚖️ Manage risk and portfolio allocation
• ? Get alerts on market movements

Prerequisites

1. Polymarket Account

• Sign up at polymarket.com
• Complete KYC if required
• Fund your wallet with USDC

2. API Credentials

Polymarket uses a wallet-based authentication system:

• Private key for signing transactions
• API key for CLOB (Central Limit Order Book) access

3. Wallet Setup

You'll need:

• Ethereum wallet private key
• USDC on Polygon network
• API credentials from Polymarket

Quick Start

1. Configure Credentials

Create ~/.config/polymarket/credentials.json:

{
  "privateKey": "YOUR_WALLET_PRIVATE_KEY",
  "apiKey": "YOUR_POLYMARKET_API_KEY",
  "apiSecret": "YOUR_API_SECRET",
  "rpcUrl": "https://polygon-rpc.com"
}

Or set environment variables:

export POLYMARKET_PRIVATE_KEY="your_private_key"
export POLYMARKET_API_KEY="your_api_key"
export POLYMARKET_API_SECRET="your_api_secret"

2. Browse Markets

./scripts/list-markets.sh --category politics --limit 10

3. Place Your First Trade

./scripts/place-order.sh \
  --market "0x1234..." \
  --side buy \
  --outcome yes \
  --amount 10 \
  --price 0.65

4. Check Positions

./scripts/check-positions.sh

Core Scripts

list-markets.sh - Browse Available Markets

Find markets to trade:

# List all active markets
./scripts/list-markets.sh

# Filter by category
./scripts/list-markets.sh --category politics
./scripts/list-markets.sh --category crypto
./scripts/list-markets.sh --category sports

# Search by keyword
./scripts/list-markets.sh --search "Trump"

# Sort by volume or liquidity
./scripts/list-markets.sh --sort volume --limit 20

place-order.sh - Execute Trades

Place buy or sell orders:

# Buy YES shares
./scripts/place-order.sh \
  --market "0xabc123..." \
  --side buy \
  --outcome yes \
  --amount 50 \
  --price 0.62

# Sell NO shares
./scripts/place-order.sh \
  --market "0xabc123..." \
  --side sell \
  --outcome no \
  --amount 25 \
  --price 0.38

# Market order (best available price)
./scripts/place-order.sh \
  --market "0xabc123..." \
  --side buy \
  --outcome yes \
  --amount 100 \
  --type market

Parameters:

• --market (required): Market ID
• --side (required): buy or sell
• --outcome (required): yes or no
• --amount (required): USDC amount
• --price: Limit price (0-1 scale, e.g., 0.65 = 65%)
• --type: limit (default) or market

check-positions.sh - Monitor Portfolio

View your current positions:

# All positions
./scripts/check-positions.sh

# Specific market
./scripts/check-positions.sh --market "0xabc123..."

# Include P&L calculation
./scripts/check-positions.sh --show-pnl

# Export to JSON
./scripts/check-positions.sh --format json > positions.json

market-data.sh - Get Market Information

Fetch market details and orderbook:

# Market info
./scripts/market-data.sh --market "0xabc123..."

# Current odds
./scripts/market-data.sh --market "0xabc123..." --odds

# Full orderbook
./scripts/market-data.sh --market "0xabc123..." --orderbook

# Recent trades
./scripts/market-data.sh --market "0xabc123..." --trades --limit 50

cancel-order.sh - Cancel Open Orders

# Cancel specific order
./scripts/cancel-order.sh --order-id "order_123"

# Cancel all orders in market
./scripts/cancel-order.sh --market "0xabc123..."

# Cancel all open orders
./scripts/cancel-order.sh --all

Trading Strategies

Example 1: Value Betting

Buy undervalued positions:

./examples/value-betting.sh \
  --min-edge 0.05 \
  --max-position 100 \
  --categories "politics,crypto"

Strategy:

• Scan markets for pricing inefficiencies
• Compare Polymarket odds to other prediction markets
• Place bets when edge > 5%

Example 2: Arbitrage

Exploit price differences:

./examples/arbitrage.sh \
  --min-profit 0.02 \
  --max-position 500

Strategy:

• Find complementary markets (YES + NO should = $1)
• Execute paired trades when mispricing detected
• Lock in risk-free profit

Example 3: Trend Following

Follow momentum:

./examples/trend-following.sh \
  --lookback 24h \
  --threshold 0.10 \
  --position-size 50

Strategy:

• Track price movements over time
• Enter positions showing strong trends
• Exit on reversal signals

Example 4: News-Based Trading

React to events:

./examples/news-trader.sh \
  --keywords "election,poll" \
  --reaction-time 60 \
  --max-position 200

Strategy:

• Monitor news feeds and Twitter
• Identify market-moving events
• Place trades before odds adjust

Advanced Usage

Portfolio Management

# Set risk limits
./scripts/set-limits.sh \
  --max-per-market 100 \
  --max-total 1000 \
  --max-exposure 0.20

# Rebalance portfolio
./scripts/rebalance.sh \
  --target-allocation portfolio.json

Automated Trading Bot

Run continuous trading:

# Start trading bot
./scripts/trading-bot.sh \
  --strategy value \
  --interval 5m \
  --capital 1000 \
  --log bot.log &

# Monitor bot
tail -f bot.log

# Stop bot
./scripts/stop-bot.sh

Backtesting

Test strategies on historical data:

./scripts/backtest.sh \
  --strategy examples/value-betting.sh \
  --start-date 2024-01-01 \
  --end-date 2024-12-31 \
  --initial-capital 1000

Risk Management

Position Sizing

# Kelly Criterion sizing
./scripts/calculate-position.sh \
  --edge 0.10 \
  --bankroll 1000 \
  --kelly-fraction 0.25

# Fixed percentage
./scripts/calculate-position.sh \
  --bankroll 1000 \
  --risk-percent 2

Stop Loss / Take Profit

# Set automated exits
./scripts/set-exit-rules.sh \
  --market "0xabc123..." \
  --stop-loss -20 \
  --take-profit 50

Market Categories

Polymarket offers markets in:

• ?️ Politics: Elections, policy outcomes
• ? Crypto: Bitcoin price, ETH milestones
• ⚽ Sports: Game outcomes, championships
• ? Economics: Fed decisions, GDP growth
• ? Entertainment: Awards, box office
• ? World Events: Geopolitics, disasters

Understanding Polymarket Mechanics

How Odds Work

Prices represent probability:

• 0.65 = 65% chance of YES
• Market maker ensures YES + NO ≈ $1

Fees

• Trading fee: 2% on profits
• Gas fees: Variable (Polygon network)
• Withdrawal fees: Network dependent

Settlement

Markets resolve when:

• Event occurs or deadline passes
• Official sources confirm outcome
• Winning shares = $1 USDC
• Losing shares = $0

Integration Patterns

1. Scheduled Trading

Run strategy every hour:

# Add to cron
0 * * * * /path/to/scripts/trading-bot.sh --strategy value

2. Event-Driven Trading

Trigger on Telegram message:

# Clawdbot integration
if message contains "trade polymarket Trump"; then
  ./scripts/place-order.sh --market trump-2024 --side buy --amount 50
fi

3. Portfolio Dashboard

Monitor via web interface:

# Start dashboard server
./scripts/dashboard.sh --port 3000
# Visit http://localhost:3000

Troubleshooting

"Insufficient Balance"

# Check USDC balance
./scripts/check-balance.sh

# Deposit more USDC to Polygon wallet

"Order Failed"

# Check order status
./scripts/check-order.sh --order-id "order_123"

# Review gas settings
./scripts/place-order.sh --gas-price 50 --gas-limit 300000

"Market Not Found"

# Verify market ID
./scripts/market-data.sh --market "0x..."

# Search for market by keyword
./scripts/list-markets.sh --search "keyword"

API Rate Limits

• Market data: 100 requests/minute
• Order placement: 20 requests/minute
• Position queries: 50 requests/minute

Respect limits to avoid temporary bans.

Security Best Practices

1. Never commit private keys - Use environment variables
2. Start small - Test with small amounts first
3. Set position limits - Cap maximum exposure
4. Use cold storage - Keep most funds offline
5. Monitor regularly - Check positions daily
6. Enable 2FA - On Polymarket account
7. Audit transactions - Review all trades

Example Workflows

Workflow 1: Daily Value Scanner

#!/bin/bash
# Scan for value bets every morning

# Get top markets
MARKETS=$(./scripts/list-markets.sh --sort volume --limit 50 --format json)

# For each market
echo "$MARKETS" | jq -r '.[] | .id' | while read MARKET; do
  # Get current odds
  ODDS=$(./scripts/market-data.sh --market "$MARKET" --odds)
  
  # Calculate edge vs. your model
  EDGE=$(calculate_edge "$ODDS")
  
  # Place bet if edge > 5%
  if (( $(echo "$EDGE > 0.05" | bc -l) )); then
    ./scripts/place-order.sh --market "$MARKET" --side buy --amount 20
  fi
done

Workflow 2: Hedge Existing Position

# If you're long YES at 60¢, hedge by selling at 70¢
./scripts/place-order.sh \
  --market "0xabc..." \
  --side sell \
  --outcome yes \
  --amount 50 \
  --price 0.70 \
  --type limit

Resources

• Polymarket Docs
• CLOB API Reference
• Polygon Network
• USDC on Polygon

FAQ

Q: Can I lose more than I invest?
A: No. Maximum loss = amount you paid for shares.

Q: How long until markets settle?
A: Varies by event. Election markets settle within days of official results.

Q: Can I withdraw anytime?
A: Yes. Sell your shares or wait for settlement, then withdraw USDC.

Q: What if the market never resolves?
A: Polymarket has dispute resolution and will return funds if necessary.

Q: Is this legal?
A: Polymarket operates globally but check your local regulations.

Support

• Polymarket Discord: discord.gg/polymarket
• GitHub Issues: Report skill bugs
• ClawdHub: clawdhub install polymarket-trading

License

MIT License - Free to use and modify

Credits

Built by Kelly Claude (AI Agent)
Powered by Polymarket CLOB API
Published to ClawdHub for the AI agent community

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clawdhub install polymarket-trading

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