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Theta Labs routes your trades through the native order books of Polymarket and Kalshi. Understanding how these markets execute orders helps you get better prices and avoid unexpected costs.

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Market orders

All trades on Theta Labs are submitted as market orders — they execute immediately at the best available price. When you place a trade, the platform:
  1. Checks the current best ask (for buys) or best bid (for sells)
  2. Submits your order to the exchange
  3. Fills as much as possible at the current price, then continues at the next available price level if needed
Market orders prioritize speed and certainty of execution over getting the exact price you saw. The actual fill price may differ slightly from the price displayed — this difference is called slippage.

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The orderbook

Both Polymarket and Kalshi use limit-order-based books, but the underlying mechanics differ:

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Polymarket (CLOB)

Polymarket uses a Central Limit Order Book (CLOB). Orders sit in the book as bids and asks. When you place a market order to buy, it matches against the lowest available ask. The CLOB is off-chain for matching but settles on-chain on Polygon.

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Kalshi

Kalshi uses a traditional exchange orderbook with limit orders. The bid-ask spread tends to be slightly wider on less liquid markets. Kalshi trades settle directly on Solana via USDC.

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Reading the spread

The bid-ask spread is the difference between what sellers want and what buyers are offering:
  • Bid = the highest price someone is willing to buy at
  • Ask = the lowest price someone is willing to sell at
  • A narrow spread (e.g., 39¢ bid / 41¢ ask) means a liquid market — you can trade near the fair value
  • A wide spread (e.g., 30¢ bid / 50¢ ask) means the market is thin — large orders will move the price significantly

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Slippage

Slippage occurs when your order fills at a different price than expected. It happens when:
  • The market moves between when you click and when the order reaches the exchange
  • Your order is large enough to consume multiple price levels in the orderbook, so later fills occur at worse prices

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Minimizing slippage

Trade in liquid markets. High-volume markets (shown by their volume figure on the market card) have tighter spreads and can absorb larger orders without significant price impact.
SituationWhat to do
Wide bid-ask spreadBreak a large order into smaller ones over time, or accept the wider cost as part of the trade
Low-volume marketExpect more slippage; size positions smaller
Fast-moving marketPrices update in real time — if a market is rapidly moving, your fill may differ from what you see

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Position sizing

A few practical rules for sizing your trades:
  • Never risk more than you’re prepared to lose entirely. Even high-probability markets can resolve unexpectedly.
  • Spread across markets rather than concentrating a large position in one. This reduces the impact of a single bad outcome.
  • Start small on new markets. Until you understand a market’s liquidity and spread behavior, keep initial positions small.
  • Account for the spread cost. If you buy at 41¢ and the bid is 39¢, you’re starting 2¢ in the hole. Factor this into your expected return.
Options trades on Theta Labs execute instantly against the platform market maker at a quoted price — there is no orderbook slippage for options. The price you see in the trade modal is the price you pay.