Position sizing caps
Set per-position and per-theme limits before entry so no single thesis dominates portfolio risk.
Playbook
Risk management for prediction market portfolios
Edge compounds when risk rules are consistent. The goal is not to avoid drawdowns entirely, but to prevent a single bad regime from taking you out of the game.
Conditional hedge triggers
Deploy hedge legs automatically when probability drops below your confidence threshold.
Time-based exits
Avoid expiry cliffs by reducing or rotating exposure as contracts approach resolution windows.
Profit routing
Move a fixed share of realized gains to wallet to prevent overexposure after winning streaks.
Implementation checklist
Define max capital at risk, build condition trees, simulate expected paths, and deploy only after your fallback actions are clear. This turns volatility from a threat into an input.