Long-term followers of prediction markets should have noticed an interesting phenomenon—political event trading instruments attract a large number of followers. However, there is a common pitfall that is easy to overlook: if you are a beginner quantitative trader or have limited capital, focusing solely on political markets can actually be disadvantageous.

Why? Although individual profits in political markets may seem attractive, the problem lies in the extremely high market efficiency. Any tiny arbitrage opportunity, once it appears, will be quickly eroded by institutional funds within milliseconds. Before you even react, the price difference has already vanished.

What does this mean? It means that without sufficient capital and ultra-low latency trading infrastructure, trying to profit from price differences in these markets is essentially futile. For individual developers with limited funds, it’s better to look for trading instruments with relatively lower liquidity and more obvious information asymmetry, where there are more opportunities.