# Kalshi Politics — Mispricing Audit (v4, archetype-targeted) — 2026-08-14

Date: 2026-08-14
Source: https://kalshi-audits.pages.dev/2026-08-14-kalshi-politics-mispricing-audit-v4

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# Kalshi Politics — Mispricing Audit (v4, archetype-targeted)

Run date 2026-08-14 · Horizon 45 days (markets closing by 2026-09-28) · Capital $2,500 · Category focus: Politics · Methodology: Keel v4 (Stage-0 allowlist, probability-before-price, precedent-fed)

Picks1
Rejects logged12
Deployed$55.44
Cash97.8%

The week in one paragraph. The v4 universe was genuinely thin: of 117 allowlisted series, only 47 open markets close inside the 45-day horizon, and just two survived the hard mechanical cuts (live volume ≥ 500, spread ≤ 5¢, not pinned at 0/100). Nearly every big Tier-1 series (SAVE Act, admin-departure ladders, ballot measures) closes in 2027. Of the two survivors, Hegseth-out is a band reject on both sides, leaving one deployable trade: fading the residual Pirro-firing bid ten days after Trump conspicuously did not fire her. Cash is the position this week — 97.8% — which the resolved record says is the correct posture in an efficient slate, not a failure to find edge.

## Pick 1 of 1 — BUY NO · KXPIRROOUT-26AUG-26SEP01

Will Jeanine Pirro announce her departure as U.S. Attorney for D.C. before Sep 1, 2026?

BUY NO @ 88¢ limit
MEDIUM conviction
archetype: multi-news-other (Tier 2)
band: 85–89¢ thin favorite → half caps
cluster: pirro-departure
closes 2026-09-01 03:59 UTC

Prob: 7% YES pre-market → 9% YES final (blended toward a moderately liquid book at 13.5¢ mid) → NO = 91% vs 87–88¢ entry. Resolver deductions: −2 loose announcement bar, −0.5 death/last-fair-price clause (total 2.5 pts, well under the 15-pt reject line).

**Thesis.** Classic post-blowup narrative hangover on a departure ladder. On Aug 3 Trump publicly said Pirro "folded like an umbrella" over her office's Reflecting Pool court filing, summoned her to the White House — and affirmatively did _not_ fire her; she did not offer her resignation ("I haven't made a determination" — Trump, per NBC 8/4). WaPo (8/8) kept the "on the outs" story alive, but ten days have now passed with no removal, no resignation, and — decisively, per the Lutnick precedent — **no successor floated anywhere in the reporting**. She is Senate-confirmed (Aug 2025), a decades-long ally, and still listed as U.S. Attorney by DOJ. The YES bid printed 71¢ intraday on Aug 3 and has decayed 32→29→28→22→23→18→20→20→18→13 on no new adverse facts: residual bid is hangover, and the market is still paying ~13.5% for an announcement inside 17 days.

**Why not HIGH conviction.** The rules bar here is the loose one: `rules_secondary` says the market "resolves based on when the departure is publicly announced or officially communicated, regardless of the effective date." A single Truth Social post naming a replacement resolves this YES overnight, and the president is genuinely angry on the record. That is a live way to be wrong — MEDIUM, half-capped, thin-favorite sizing.

Precedents consulted: KXKASHOUT-26APR-JUN01 resolved NO — "anonymous 'it's only a matter of time' sourcing is not a resolution event… sell the spike into the news cycle rather than buying it" (that rung was 67% and died). KXLUTNICKOUT-26JUL01 resolved NO — "absent a named successor, price any single month near the base rate." KXHEGSETHOUT-26APR-JUN01/JUL01 both NO — fury without an affirmative White House signal never converts. And this run verified KXPIRROOUT-26AUG-26AUG05/06/07 all settled NO in the days immediately after the blowup itself.
Resolver profile. Resolver: Kalshi, off any credible public announcement or official communication (White House, DOJ, or Pirro herself) by market close Sep 1 03:59 UTC. Boundaries: announcement counts even if effective later (−2 on NO); temporary leave/suspension/recusal does NOT count; death → last-fair-price discretion (−0.5). The series family's resolution record shows the resolver waits for the actual announcement — rumor cycles have never settled these YES.

**Entry context (fetched 2026-08-14).** YES 13/14 (NO 86/87), 24h volume 2,342, OI 34,348. Contra depth for NO buys: ~70 contracts at 87¢ + ~120 at 88¢ = 190 at or below the 88¢ limit → depth cap 63 contracts. 48h price check: −4¢ toward NO (with thesis, not chasing). Slippage at limit: ≤1¢. Not a continuous-number thesis (discrete announcement event). Volume < 5,000 → not specialist-dense.

## Position sizes & limits

| Market | Side | Limit | Contracts | Max cost | Max win | Cap binding |
|---|---|---|---|---|---|---|
| KXPIRROOUT-26AUG-26SEP01 | NO | 88¢ | 63 | $55.44 | $7.56 | Depth cap (63 = ⅓ × 190 visible) < $75 MEDIUM thin-favorite half-cap |
| **Total deployed** |  |  |  | **$55.44 (2.2%)** |  | Cash $2,444.56 (97.8%) · reserve ≥10% ✓ |

## EV for the record

| Market | Entry | Model prob (side) | EV/contract | EV position | EV % of cost |
|---|---|---|---|---|---|
| KXPIRROOUT NO | 88¢ | 91% | +3.0¢ | +$1.89 | +3.4% |

Sizing is EV-agnostic per v4; EV shown for the record only. Thin-favorite economics: risking $55.44 to win $7.56 — one loss erases ~7 wins, which is exactly why the band carries half caps.

## Cluster table

| Cluster | Deployed leg | Runner-up legs |
|---|---|---|
| pirro-departure | KXPIRROOUT-26AUG-26SEP01 NO | None in-window (the Oct-1 rung closes outside the 45-day horizon) |

## Conviction exposure

| Tier | Positions | Cost | % of capital | Cap |
|---|---|---|---|---|
| HIGH | 0 | $0 | 0% | 15% ($375) / 7% in 85–89¢ |
| MEDIUM | 1 | $55.44 | 2.2% | 7% ($175) / 3% ($75) in 85–89¢ |
| Cash | — | $2,444.56 | 97.8% | 40–70% expected; more this week is a statement about the slate, not caution |

## Risk profile

- **Single-name risk:** the entire deployed book is one thin-favorite leg. Worst case (Pirro announcement before Sep 1): −$55.44 (2.2% of capital). Best case: +$7.56.
- **The live way to be wrong:** a Trump post or DOJ statement naming a replacement — the loose "announced or officially communicated" bar means it needs no effective date. That risk is why this is 91 and MEDIUM, not 96 and HIGH.
- **What would flip the read:** any successor's name entering the reporting (the Lutnick tell), or a second public Trump escalation. Either → exit or write off; do not average down on a news-cycle name.
- **No correlation risk:** one cluster, one leg, nothing else deployed.

## Execution notes

- Rest a NO limit at 88¢ (equivalently: sell into YES bids at ≥12¢). Expect ~70 contracts to fill near 87¢ and the remainder at 88¢; average fill ≈ 87.2¢.
- Do not chase below 88¢ NO — at 89¢+ the edge is inside the model's error bars.
- Book is thin at size: 63 contracts is the ⅓-of-visible-depth cap from the book actually fetched at 2026-08-14 ~17:00 UTC. Re-fetch depth before entry if executing later than +24h.
- Market closes Sep 1 03:59 UTC; no early-exit plan needed at this size, but the flip conditions above override.

## Rejects log (12)

| Market | Archetype | Px | Reason |
|---|---|---|---|
| KXHEGSETHOUT-26APR-SEP01 | multi-news-other | YES 4.8/5.1 | **deep-favorite band.** Stage-2 survivor; pre-market YES 2.5% (strict `rules_secondary`: "must have an actual departure date and vacate the role"; active-conflict structural NO per 2× series precedents; no successor named; third consecutive rung just settled NO on Aug 1). NO entry ≈95¢ ≥ 90¢ reject line; YES is a <40¢ tail. Also specialist-dense (vol24h 7,290). |
| KXGOVTFULLFUND-26AUG-26SEP26 | confirmation/enact | 47/54 | illiquid book: vol24h 183 < 500 hard floor; 7¢ spread also fails. Core-band price but the zero-volume cohort was negative-edge lifetime — hard skip. |
| KXKASHOUT-26APR-26SEP01 | departure/ouster | 4/5 | illiquid (vol24h 340); NO would also be ≥95¢ deep favorite. |
| KXUSAIRANAGREEMENT-27-26SEP | scheduled-process | 1/2 | illiquid (vol24h 257); YES tail. |
| KXMAMDANIEO-26AUG15-T0 | confirmation/enact | 2/3 | illiquid (vol24h 338). |
| KXIPOANTHROPIC-DATE-26SEP01 | corporate-event | 0/1 | tail: YES ask 1¢; NO ≥95¢. No playable side despite 63k vol24h. |
| KXCOMPANYACTIONMERGER-27-26SEP01 | corporate-event | 3/4 | tail: YES ask 4¢ mechanical cut despite 71k vol24h. |
| KXIMPEACH-26-SEP01 | legal-action | 0/1 | tail: YES ask 1¢. |
| KXLEAVEMILLS-26NOV03-26SEP01 | departure/ouster | 2/6 | illiquid (vol24h 255). |
| KXLEAVEPOWELLGOV-26SEP01 | departure/ouster | 1/3 | illiquid (vol24h 234); Jul-1 precedent already pinned this near 0 — no edge either way. |
| KXLEAVELISACOOK-26SEP01 | departure/ouster | 2/3 | illiquid (vol24h 133). |
| KXIPOOPENAI-26SEP01 | corporate-event | 0/2 | illiquid (vol24h 106); YES tail. |

Existing pick KXCRYPTOSTRUCTURE-26JAN-SEP is outside the v4 allowlist and was not re-touched. No cluster runner-ups and no outside-universe research this run.

## Universe & method notes

- **Stage 0:** 117 allowlisted series from `targets.json` (generated 2026-08-14 16:06 UTC) → 47 live open markets closing by 2026-09-28 (fetched per-series from the public API, not the mirror — the mirror showed 119 rows of which many were stale-status) → 2 survivors after the mechanical cuts. The slate is structurally thin because the high-OI Tier-1 series (KXSAVEACT, KXTRUMPADMINLEAVE, KXSTATEBALLOTMEASURE, KXRETIREMM…) all close 2027.
- **Probability before price:** both pre-market numbers (Pirro YES 7%, Hegseth YES 2.5%) were committed after rules + precedents + news and before opening books or candlesticks; blends and entry context recorded above.
- **Precedent store:** 12 departure/ouster rows retrieved; 4 rows directly on the two candidate series. Two new rows written back this run (Pirro Aug-5/6/7 blowup-week NOs; Hegseth Aug-1 third-consecutive NO) — see `precedents.json`.
- **Zero-ish deployment is the output, not a bug:** one thin-favorite leg at 2.2% of capital, 97.8% cash. An efficient week under v4 rules.