Original Author: Mach, Foresight News
If someone told you that there are some smart traders who can make money by predicting the weather and temperature, would you believe it?
The trader in the above image, named neobrother, has gone wild betting on the weather of various cities on Polymarket, accumulating over $20,000 in profits so far. He is not a reckless gambler, but rather a highly data-driven expert in niche markets who is skilled in odds and leverage. neobrother's trading record is almost entirely focused on weather predictions (Weather Markets), especially the daily high temperatures of major cities around the world (Buenos Aires, Miami, Ankara, Chicago, New York).
He doesn't bet on "big trends," but only on "accuracy," like a grid arbitrageur in the field of meteorology.
Taking the temperature forecast for Buenos Aires as an example, he did not just bet on a single temperature, but instead adopted a "temperature laddering" strategy, simultaneously buying Yes for 29°C, 30°C, 31°C, 32°C, 33°C, and even 34°C+. This approach is similar to the "straddle" or "grid trading" in options. By placing a dense set of low-cost orders (0.2¢ - 15¢) within a temperature range that is likely to occur, as long as the final temperature falls within this range, the extremely high returns from one or two positions (such as 811.78% return from 31°C) can cover the losses from all the other rungs of the ladder and achieve substantial profits.
In addition, he is also good at capturing some low-probability profit opportunities. The unit price of most of the prediction markets he buys is extremely low. For example, his average purchase price for the position of 32°C in Buenos Aires was only 0.7¢. This purchase price means he obtained a potential odds of nearly 142 times. The screenshot shows that the position has now risen to 5¢ (an increase of 733%).
He can use minimal costs to speculate on the drastic price fluctuations caused by deviations in weather forecasts. This style requires a deep understanding of weather models (such as ECMWF or GFS), and the ability to decisively lie in wait when market price reactions are lagging.
These 2373 predictions indicate that its trading is extremely frequent and highly automated/systematic. It is very likely a quantitative or semi-quantitative trader who uses scripts to monitor weather forecast changes in real time and place orders. He does not tie up large amounts of capital in a single position, but instead constantly seeks hundreds of times profit with minimal costs, and quickly withdraws the profits or reinvests them for the next round of compounding.
He might have a set of more accurate and real-time weather forecasting sources than most retail investors on Polymarket (possibly accessing weather station APIs). Politics and sports have too much noise, but weather is pure physics and math. As long as the model is accurate enough, this becomes his endless ATM.
If this trader is a "weather geek" who precisely calculates the weather in the lab, then Hans323 is the "black swan hunter" and "top odds master" on Polymarket. In the London weather prediction, he dared to bet $92,000 in a single bet with only an 8% chance of winning, and crazily earned $1.11 million in profit.
Hans323's operations have moved beyond simple prediction; he is using **extremely asymmetric risk-reward ratios (Asymmetric Risk-Reward)** to carry out large-scale capital harvesting.
Looking at his winning record, the purchase price is usually between 2¢ - 8¢. In prediction markets, this represents the market's belief that the probability of the event occurring is only 2% - 8%. A regular player might only bet $10 on a 2¢ ticket, but Hans323 dares to invest $92,632 at the 8¢ position (London temperature ticket).
This strategy is similar to the "leveraged investing" approach of hedge fund manager Nassim Taleb. He doesn't care if 90% of his predictions fail, because just one hit with a 1,100% or even 5,300% return is enough to cover the costs of thousands of trial and error attempts.
Unlike neobrother's "staircase full coverage," Hans323 is more inclined to invest heavily in specific, statistically biased narrow price points, which requires extremely strong confidence and support from underlying models.
In addition, by reviewing all of his historical trades, this trader might be a jack-of-all-trades, possibly backed by a strong data scraping team or intelligence sources in vertical fields. For example, in the political field: betting that Trump would issue fewer than 10 executive orders in June (7¢ entry), in the sports field, decisively buying in when the odds for Scottie Scheffler winning the PGA were extremely low (2¢), and also successfully predicting the Time Person of the Year in the cultural field (6¢), the player achieved good results in all cases.
Earning money is one thing, but when ordinary users track the trading records of Polymarker experts, they shouldn't just look at their win rate, but also pay attention to tracking their capital skewness and focus on their own risk control. Because the same large loss can have vastly different levels of tolerance for different people.