Market Making#140

Two-Sided Spoof-Resistant Penny-Jump Quoting

On thin order books, watch when a rival market-maker parks one tick better than the best price, and step in front of them by the minimum increment, but only when real resting size sits behind that price rather than fake flicker that gets cancelled instantly. The edge is telling a genuine queue apart from spoofed bluffs by measuring how long orders actually live.

What you need to run it

Full L2 book with per-order add/cancel timestamping
Cancel-rate / order-lifetime classifier per counterparty
Tick-by-tick re-quote engine with anti-self-cross guard
Inventory caps to bound directional fills from jumping

Where this applies

Markets on Polymarket where two-sided spoof-resistant penny-jump quoting is the natural play:

Will Solana close above $400 at any point before the end of 2027?
Will there be a US federal government shutdown before the end of 2027?
Will the sitting Fed Chair be replaced before the end of 2027?

Capabilities this demands

Low latencyCustom code / APIModel / quantRisk management

At a glance

CategoryMarket Making

Requirements4

CapabilitiesLow latency, Custom code / API, Model / quant, Risk management

VenuePolymarket (CLOB, Polygon)

Build it

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This is documentation, not advice. Poly Research & Robotics publishes how these strategies work because the method should be checkable — not as a recommendation to trade them. See the full strategy database (147 strategies) or the data resources directory.