Can You Actually Make Money on Kalshi?
Yes. But most people don't.
Kalshi is a federally regulated prediction market where you buy and sell contracts tied to real-world outcomes: inflation numbers, Fed rate decisions, election results, weather events, and more. If you're right, you profit. If you're wrong, you lose your stake.
The honest answer is that making consistent money here requires the same discipline as trading stocks or sports betting professionally. It's not passive income. It's not a side hustle you set and forget. It's a skill, and the skill takes time to build.
That said, there are real edges available on Kalshi that don't exist in traditional financial markets. We'll show you where they are.
How Kalshi Actually Works
Before talking strategy, you need to understand the mechanics.
Every contract on Kalshi is a yes/no question. "Will the Fed raise rates in March?" "Will US inflation exceed 3% in Q2?" You buy "Yes" shares or "No" shares. Shares are priced between $0.01 and $0.99, and a correct prediction pays $1 per share. The price reflects the market's implied probability of the outcome.
So if "Yes" shares trade at $0.65, the market thinks there's a 65% chance the event happens. You make $0.35 per share if you're right. You lose $0.65 per share if you're wrong.
Kalshi takes a small fee on winnings, typically around 7%. That's your constant headwind. Every edge you find has to overcome that fee first.
The Four Ways Traders Make Money on Kalshi
1. Information Edges
This is the most straightforward approach. You know something the market doesn't, or you've done more research than the average participant.
Example: You're an economist who tracks the PCE data closely. The consensus on Kalshi says inflation will stay below 2.8%. You've built your own model and think it'll hit 3.1%. You buy "Yes" on the over contracts at favorable prices.
The key is finding markets where the average participant is lazy or uninformed. Economic data markets, local election markets, and niche weather contracts often have weaker "efficient market" dynamics than, say, Presidential election contracts where millions of eyes are watching.
2. Probability Mispricing
Sometimes the market is just wrong about the math.
This happens when sentiment drives prices away from base rates. If a popular political figure announces something dramatic, related contracts can swing emotionally. Calm, data-driven traders can fade that overreaction.
One concrete example: After a surprising jobs report, markets sometimes overcorrect on Fed rate contracts. If the base rate for a rate cut given current economic conditions is historically 20%, but panic pushes the contract to 40%, selling "Yes" at $0.40 is a strong value play.
This requires building your own probability models, not just gut feelings. Track outcomes. Keep records. Know your calibration.
3. Market Making and Arbitrage
More advanced traders use Kalshi's order book to act as market makers. They place limit orders on both sides of a market, collecting the spread between bid and ask.
This works best in liquid markets with consistent two-sided flow. The risk is inventory risk: if you're holding a position when new information arrives, you can get caught badly.
Arbitrage between Kalshi and other prediction markets (Polymarket, PredictIt when available) is another approach. When the same event prices differently across platforms, you can buy low on one and sell high on the other, locking in risk-free profit. These gaps close fast, though. You need to be systematic and fast.
4. Portfolio Diversification Strategy
Instead of betting big on single outcomes, some profitable traders spread small positions across dozens of contracts where they have a slight edge. The law of large numbers works in their favor over time.
Think of it like a poker player. You don't need to win every hand. You need to make positive expected value decisions repeatedly. Over 500 contracts, a consistent 5% edge becomes real money.
Markets Where You're Most Likely to Find an Edge
Not all Kalshi markets are equal. Some are brutally efficient. Others are surprisingly soft.
- Economic data releases: CPI, PCE, jobs numbers, GDP. These attract fewer sharp bettors than you'd expect. If you follow economic data seriously, this is your lane.
- Local and state-level political markets: Much less scrutiny than national races. Traders who follow local politics closely can find significant mispricings.
- Weather and climate contracts: Counterintuitive, but these can be profitable for people who actually understand meteorology and seasonal patterns beyond what a casual observer knows.
- Niche tech and business markets: "Will OpenAI release X by Y date?" type questions. People with deep industry knowledge can outperform casual observers significantly.
Avoid Presidential and national election markets unless you have a specific, researched view. Those markets are extremely liquid and watched by some of the sharpest traders in the world.
What Losing Traders Do Wrong
We've seen enough prediction market activity to identify the patterns that drain accounts.
Betting on what they want to happen. This is the biggest one. Political traders especially fall into this trap. Your preferred candidate winning is not a trading thesis. The market doesn't care about your hopes.
Ignoring the fee structure. A 7% fee on winnings sounds small. It isn't. On a contract at $0.50, your break-even win rate isn't 50%: it's closer to 53.5%. Every trade starts in a hole. You need a real edge to climb out.
Position sizing badly. Putting 30% of your account on one contract is not a strategy. Even a high-confidence trade can lose. Experienced traders rarely put more than 3-5% of their bankroll on a single position.
Not keeping records. If you don't track your trades, you can't learn from them. After three months, you should know exactly which market types you perform well in and which you don't.
Practical Bankroll Management
Treat your Kalshi account like a trading account, not a casino chip.
Start with an amount you can afford to lose entirely. Seriously. Even skilled traders have losing periods, and starting out, you're not a skilled trader yet.
A reasonable starting approach for new traders:
- Start with $500 to $1,000.
- Never risk more than 3% of your bankroll on a single contract.
- Track every position: what you bought, at what price, your reasoning, and the outcome.
- After 50 trades, review your record. Are you winning where you expected? Losing where you shouldn't?
- Scale up only after you have data showing consistent positive expected value.
The goal in your first few months isn't profit. It's calibration. Learn whether your predictions are accurate. Most people discover their initial confidence is way off from their actual accuracy rates.
Using AI Tools to Research Markets
One genuine edge available in 2026 is using AI assistants to accelerate research. When we're evaluating an economic data contract, we use AI tools to quickly summarize recent Fed statements, pull historical data patterns, and stress-test our assumptions.
We've tested several AI tools for this kind of research work. Check out our comparison of ChatGPT vs Claude for 2026 if you want to pick the right research companion. For political and news-based markets, Claude has become our preferred tool for summarizing large volumes of information quickly without hallucinating facts.
AI won't tell you which way a contract will go. But it can help you process information faster than your competitors, and in prediction markets, speed and thoroughness matter.
Tax Implications You Need to Know
Kalshi is a regulated exchange. Your winnings are taxable. In the US, prediction market profits are treated as ordinary income, not capital gains.
Keep detailed records of every trade throughout the year. Kalshi provides tax documents, but they won't do your categorization work for you. If you're making meaningful money, work with a tax professional familiar with financial trading. This is not optional.
How Much Can You Realistically Make?
Let's be blunt. Most casual users make nothing or lose money. This isn't a criticism. It's just the math of a market where someone has to be on the wrong side of every trade.
Serious traders with a genuine edge and proper bankroll management can realistically aim for 15-40% annual returns on their Kalshi stake. That sounds great until you realize it means someone with $5,000 deployed might earn $750 to $2,000 per year. Good supplemental income. Not a replacement salary.
The traders doing meaningfully better than that are usually running large stakes, operating systematically across many markets, or have access to information sources most people don't.
If someone is promising you a system to make $10,000 a month on Kalshi with minimal effort, they're lying to you.
Getting Started: A Step-by-Step Approach
- Sign up and verify your account. Kalshi requires identity verification as a regulated exchange.
- Browse markets without betting first. Spend a week just looking at contracts and noticing which ones you have informed opinions on.
- Pick one market category to specialize in. Economic data, tech events, political outcomes. Focus beats breadth when you're starting.
- Make small test trades. Start with $10-20 per position to learn the mechanics without real risk.
- Build your research process. What data will you consult before each trade? Make it systematic, not impulsive.
- Review and adjust monthly. Where are you making money? Where are you losing? Double down on your strengths.
For AI-assisted market research and keeping up with news that affects your contracts, you might also find our review of the best AI chatbots worth reading. Having a fast research tool becomes genuinely valuable when you're trying to evaluate 10 contracts at once before a market moves.
The Bottom Line
Kalshi is one of the most intellectually honest ways to make money from your knowledge and analytical skills. Unlike stock picking, where you're competing against institutional traders with massive infrastructure advantages, prediction markets still have pockets where individual smart traders can consistently win.
But it takes real work. You need a process, discipline around position sizing, honest record keeping, and the patience to build your edge over many trades rather than swinging for home runs.
Start small. Learn your calibration. Find the markets where your knowledge is actually superior to the crowd. Then scale slowly, and let the edge compound.
That's it. There's no secret system. The traders making money on Kalshi are just more informed, more disciplined, and more honest with themselves than the ones losing it.