Conditional Market Arbitrage Engine

Conditional Market Arbitrage Engine MCP Connector for Claude

A+

Identify risk-free arbitrage in conditional prediction markets using Bayesian probability.

3 tools Official Updated Oct 1, 2026 Official Vinkius Partner

This MCP server provides deterministic tools to identify arbitrage opportunities in conditional prediction markets. By applying Bayes' theorem, it compares the observed price of a conditional market (B given A) against the theoretical price derived from base markets A and B. Use analyze_conditional_arbitrage to detect price deviations greater than 5% and receive specific trade instructions to lock in guaranteed returns. It also includes verify_market_independence to check if events are independent and calculate_joint_probability_requirement to determine the fair price for joint outcomes.

bayesianprediction-marketsarbitrageprobabilityfinance

3 tools expose this connector's capabilities to your AI agent.

analyze_conditional_arbitrage

Evaluates the relationship between base markets and a conditional market to identify arbitrage opportunities

calculate_joint_probability_requirement

Determines what the price of a "Both A and B" market should be based on existing conditional and base market prices

verify_market_independence

Determines if the conditional market's price is consistent with the base market B, assuming event A has no influence on B

See how to talk to your AI agent using Conditional Market Arbitrage Engine.

Find arbitrage opportunities where priceA is 0.6, priceB is 0.5, priceBGivenA is 0.7, and capital is 1000.

Arbitrage detected! The theoretical conditional price is 0.4167, but the market price is 0.7. Deviation is 68%. Suggested trades: Buy market A for $400, Buy market B for $500, and Sell conditional market B|A for $700. Guaranteed return: $125.00.

Check if market B at 0.4 and conditional market B|A at 0.4 are independent.

The events are independent. The deviation is 0.0, meaning the occurrence of event A does not change the probability of event B.

What should the joint probability be if priceA is 0.5 and priceBGivenA is 0.8?

The calculated joint probability for both events occurring is 0.4.

The engine uses `analyze_conditional_arbitrage` to calculate the theoretical conditional price using Bayes' theorem. If the market price deviates from this theoretical value by more than 5%, an arbitrage opportunity is flagged.

Related Connectors