We study trading gains and losses on Polymarket, the largest prediction market by trading volume. Using $67 billion in trade volume, we show that the gains are highly concentrated: the top 1% of users with positive PnL capture 76.5% of profits. Successful traders provide liquidity using limit orders that resolve favorably relative to realized outcomes while unsuccessful traders take liquidity using market orders. Monthly performance is modestly persistent, though this may reflect selection rather than skill. Analysis of the trading behavior of the most successful accounts suggests that “insider” trading is unlikely to explain the performance of the largest winners.

zlynne@ceibs.edu