Preprint
Jul 2026
Uniform-Loss Automated Market Making for Prediction Markets
The framework of loss-versus-rebalancing (LVR) is used to study how the total worst-case loss to the subsidizer is distributed across price states or over time and extended to dynamic liquidity management, showing that liquidity levels can be adjusted over time to implement a prescribed target expected cumulative loss schedule.
C. Moallemi, D. Robinson, Brian Z. Zhu
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