---
title: Limits to Arbitrage and Prediction Market Efficiency: the Case of PredictIt
url: https://www.ml-quant.com/papers/repec/nbr-nberwo-35845/
site: ML-Quant (https://www.ml-quant.com)
updated: 2026-10-23
license: Summaries CC BY 4.0; links go to the original sources
index: https://www.ml-quant.com/llms.txt
identifier: RePEc:nbr:nberwo:35845
source_url: https://econpapers.repec.org/RePEc:nbr:nberwo:35845
featured: 2026-10-23
citations: unknown
topic: Trading, Microstructure & Execution
---


# Limits to Arbitrage and Prediction Market Efficiency: the Case of PredictIt

Analysis of PredictIt shows that limiting investor stakes to $850 per contract undermines price accuracy, with bid prices persistently implying arbitrage profits even after fees.

- Source: https://econpapers.repec.org/RePEc:nbr:nberwo:35845
- Identifier: RePEc:nbr:nberwo:35845
- Released: 2026-10-19
- First featured: Quant Letter No. 136 (2026-10-23): https://www.ml-quant.com/issues/2026-10-23/
- Citations (Semantic Scholar): not tracked
- Published in: not yet
- Topic: Trading, Microstructure & Execution
- Authors: Eric Zitzewitz

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