TYPES OF EVENTS YOU CAN TRADE
Plain English
Prediction markets cover a wide range of events. The most interesting for traders are economic data releases (CPI, jobs report), Federal Reserve decisions, financial market outcomes (will the S&P hit a specific level?), and political events. Each category has different drivers and requires different analysis.
Going deeper
Event categories on platforms like Kalshi: (1) Economic Data — CPI, PCE, NFP payrolls, GDP, unemployment rate. These have scheduled release dates and can be predicted using macro analysis and market surveys. (2) Federal Reserve Policy — rate hike/cut/hold decisions, each meeting outcome is a separate contract. (3) Financial Markets — S&P 500 range at year-end, whether Bitcoin will hit specific price levels, ETF approval decisions. (4) Political — election outcomes, legislative actions, executive order probability. (5) Climate & Weather — hurricane tracks, temperature records, drought declarations. (6) Corporate Events — merger approval, bankruptcy filings, executive departures. Each category requires different expertise — an economist might have edge on CPI contracts while a political scientist has edge on election contracts.
Examples
Economic Event Example
Before a monthly CPI release, Kalshi offers contracts like 'Will CPI be above 3.2%?' The Bloomberg consensus estimate and market pricing in Treasury inflation swaps give you anchors. If the consensus is 3.1% and the contract prices Yes at 35%, you can decide if 35% underweights or overweights the risk of an upside surprise.
FOMC Decision Markets
Before each Fed meeting, contracts like 'Will the Fed raise rates at the September FOMC meeting?' trade based on the Fed Funds futures probability, economic data, and Fed speaker commentary. These often closely track the CME FedWatch tool, but can diverge when Kalshi participants see things differently.