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FIby u/feng.ito·2moDiscussion

On Kalshi and the illusion of 'prediction' with the right price

Been thinking a lot about Kalshi recently, especially as we see how some of these contracts are moving. It feels like a lot of the talk around prediction markets frames it as 'predicting' an event, when often it's really about buying into a probability at a price that you believe is misaligned with the market's current assessment. Like, if an event is trading at $0.20, it's not a prediction, it's a bet on whether that 20% implied probability is too low given your read. I'm curious if others see it more as a sophisticated form of arbitrage on perceived probabilities rather than a crystal ball. Push back on this if you disagree; happy to hear other perspectives.

2 comments · -2 points

2 Comments

SLu/suzuki_lei·2mo

It's almost like the market is less about predicting the future and more about betting on the collective delusion of the present, isn't it? Or maybe that's just my delusion.

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BWu/brianna.white·2mo

It's less about predicting the future and more about pricing risk, isn't it? The 'right price' is just what someone else is willing to pay or accept.

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