When to take profit
You never have to wait for resolution, shares sell at every moment, at the current price. Taking profit well means selling when the edge is gone, not when the feeling says so. The rule fits in one question.
You don’t have to hold to resolution, the real test is whether you’d open the position again at today’s price. If not, the edge is gone and it’s time to exit; your CEO writes that exit at entry.
Ask a losing bettor about their entries and you’ll hear good stories. Ask about exits and you’ll hear silence. Most people never decided one. Yet the exit is where a paper edge becomes banked money. The good news: the discipline is one honest question, asked on schedule.
01Resolution is optional
As the Polymarket guide walks through, a bet has two endings: hold to resolution and collect $1 or $0, or sell any time before at the live price. Buy Yes at 61¢, watch the crowd come around to 74¢, those 13 cents are yours the moment you sell, match unplayed. Every open position is therefore a standing decision: at this price, keep or fold?
02The one-question test
The clean way to answer it: if I held cash instead, would I buy this position at today’s price? You entered at 61¢ because your evidence said 74%. The market now sits at 74¢, exactly your estimate. Would you buy at 74¢ believing 74%? No: that is a fair price, and the fund never bets a price it believes is fair. Then don’t keep it either, holding a position is buying it again, silently, at every tick.
Sell when the edge is gone, not when the position “feels” done. The price reached your estimate, that’s the finish line, whatever the market does next.
03Write the exit at the entry
The moment of maximum clarity is before the money moves. A well-formed bet carries its exits from day one: the target where the edge is spent, the level where the thesis is wrong, the news that would change everything. Decided in advance, exits are analysis; improvised mid-move, they are mood. This is also where partial exits earn their place, bank half at the target, let the rest ride with the house’s money and a stop behind it.
04What this looks like in your fund
Your CEO writes the exit plan into every position it opens, re-runs the one-question test as prices and evidence move, and records each sale next to its reason, edge spent, thesis broken, or better use for the capital elsewhere. You read it all in the memo, and every trade explains itself. No promises about outcomes; a promise about process.
Common misreads
- Holding to resolution out of habit. If you wouldn’t enter again at today’s price, the edge is already gone.
- Letting winners ride on hope. A position with no remaining edge is just exposure. Your CEO closes it.
- Moving the exit after the fact. The exit is written at entry, before emotion gets a say.
What to remember
- Holding to resolution is optional Exiting early is often right.
- The test: would you enter again at this price? If no, take profit.
- The exit is decided at entry, before emotion gets a vote.
- Your CEO closes when the edge is spent, not when it feels good.