Methodology
Merlin uses proprietary scoring algorithms to evaluate Polymarket traders. This page documents every metric formula, data source, and methodology used in our analytics. All metrics are computed in real-time from Polymarket's public API data.
Merlin Trader Score (0-100)
The Merlin Trader Score is a composite metric that evaluates overall trader quality on a scale of 0 to 100. It combines four weighted factors across multiple time periods to provide a single, comparable score.
P&L normalization uses a logarithmic scale (log10(|PnL| + 1) / 6) to prevent extreme outliers from dominating.
ROI is capped at 100% to avoid skewing by low-volume traders. The final score is clamped to 0-100.
ROI Rating (S/A/B/C/D)
The Merlin ROI Rating is a letter grade based on return on investment percentage.
ROI is calculated as (P&L / Volume) × 100.
Insider Score (0-100)
The Merlin Insider Score measures the likelihood that a trader has informational edge in prediction markets. It analyzes patterns of profitable betting on low-probability outcomes (entry price < 35¢).
Longshot threshold: average entry price below 35¢. A score above 70 indicates strong potential informational edge.
Whale Tiers
Traders are classified by all-time trading volume into four tiers:
Trader Tags
Merlin assigns behavioral tags to traders based on their trading patterns:
Win Rate
Win Rate is calculated from closed positions. For each unique market (conditionId), Merlin compares total buy cost versus total exit value (sells + redeems). If exit value exceeds buy cost, it counts as a win. Win Rate = (wins / total closed positions) × 100.
Risk Score (1-10)
The Risk Score is a composite of three factors:
Risk levels: Low (1-3), Medium (4-6), High (7-10).
Data Sources & Update Frequency
All metrics are computed in real-time from cached Polymarket API responses. No data is fabricated — everything derives from publicly verifiable on-chain data on the Polygon blockchain.