# Kalshi Politics — Mispricing Audit (Anchor, NO-side structural) — 2026-10-07

Date: 2026-10-07
Source: https://kalshi-audits.pages.dev/2026-10-07-kalshi-politics-mispricing-audit-anchor

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# Kalshi Politics — Mispricing Audit (Anchor, NO-side structural)

Report date 2026-10-07 · strategy=Anchor · audit_version=anchor · category focus: Politics (advisory) · horizon 45 days · capital $2,500 · universe: targets.json (120 series, generated 2026-10-07T16:36Z)

## 1. Summary

0picks deployed
19logged rejects
$0allocated · $2,500 cash (100%)
830open markets scanned

**Verdict: hold cash.** The 45-day window inside the allowlist contains almost nothing Anchor can trade. Of 830 open markets in the 120 target series, 798 close beyond Nov 21, and the in-horizon remainder is dominated by "before Nov 1" tails priced at 1–5¢ (NO side ≥95¢, deep-favorite band) or markets with no 24-hour volume. Only one cluster survived the mechanical cuts: the Bank of Canada's October 28 decision ladder. It was researched in full (Stages 1–3) and rejected at the current price on two Anchor rules: the book already prices the hold at 79–81¢ against a 77% blended probability, and the cleanest way the NO-on-hike leg loses is the inflation trend continuing into the October 19 CPI. Zero picks is the methodology's expected result in a week like this.

## 2. Universe and funnel (Stage 0)

| Step | Markets | Note |
|---|---|---|
| Open markets in the 120 allowlisted series (live API) | 830 | Tier 1: 70 series, Tier 2: 50 series; no Tier 3 in file |
| Close within 45 days (by Nov 21, 2026) | 32 | 798 cut as beyond horizon |
| … and YES ask > 5¢ and YES bid < 95¢ | 9 | 23 are 1–5¢ "before Nov 1" tails (NO side in the ≥90¢ band) |
| … and spread ≤ 5¢ and live volume24h ≥ 500 | 2 | KXCBDECISIONCANADA-26OCT-H0 and -H25 |
| Expires ≥ 7 days out, close ≤ expiration + 1h, not a Mentions / continuous-number market | 2 | both pass; one cluster |

Fifty markets failed the new "close after expiration" rule (close_time more than 1h after expected_expiration_time), including the highest-volume market in the file, KXCAWEALTHTAX-26 (115,780 contracts/24h). The existing pick KXDIESELEXPORTBAN-26 was excluded and is logged. No Mentions markets are in the allowlist.

## 3. Picks

None. Cash is the position this run: $2,500 (100%) held, well above the ≥10% reserve floor. No cluster produced a leg that survived Stage 3 at a fillable price inside the 60–89¢ band.

## 4. The one researched cluster: Bank of Canada, October 28, 2026 ( boc-oct28-decision )

scheduled-processTier 2Economics (in-file; category focus is advisory)

### Resolver and rules

Resolver: Kalshi, off the Bank of Canada's 09:45 ET announcement. Rules (verbatim, both legs): "If the Bank of Canada does a Hike of 0bps at its Oct 28, 2026 meeting, then the market resolves to Yes" / "… a Hike of 25bps …". `rules_secondary` is empty on both legs. Settlement timer 1,800 s. Close and expected expiration both 2026-10-28T13:29Z (21 days out).

### YES condition sentence

_H0:_ For YES to pay, the Bank of Canada must announce an unchanged 2.25% overnight target at its scheduled Oct 28, 2026 fixed announcement date, resolved by the Bank's press release. _H25:_ For YES to pay, the Bank must announce a 25bp increase to 2.50% at that same date. The blank is a new action by an institution at a dated step, so this is an Anchor-shaped market (not a continuous-number thesis).

### Precedents consulted (Stage 1)

- `KXCBDECISIONCANADA-26JUL-H0` → yes; `-26JUL-H25` → no (sixth consecutive hold, July 15). Store lesson: "Two-sided guidance … keeps both middle rungs alive in the narrative while neither gets priced — narrative symmetry is not distributional symmetry, and the BoC ladder pays only if you resist trading the guidance text."
- `KXCBDECISIONCANADA-26SEP-H0` → yes; `-26SEP-H25` → no (verified this run via public API, finalized 2026-09-02T19:07Z; written back to `precedents.json`).
- `KXFEDDECISION-26JUL-H25` → no: a 25bp hike rung "repriced from ~11% to ~36–38% in nine days still resolved NO, so a hawkish repricing into a live FOMC is a fade candidate rather than a signal — dissent, not a rate move, is how the Committee vents that pressure."
- `KXCBDECISIONJAPAN-26JUN15-HOLD` → no (the counter-case): when a bank has actually telegraphed a move, "hold legs must be priced off the signalling, not off the bank's history."

### Diligence (Stage 2) — vehicle, calendar, already-happened

- **Vehicle:** the Oct 28 fixed announcement date with a Monetary Policy Report, on the Bank's published schedule (press release, Sep 2: "The next scheduled date for announcing the overnight rate target is October 28, 2026").
- **Current stance:** 2.25% held for the seventh consecutive time on Sep 2, 2026, "with the economy and inflation evolving broadly as forecast in the July MPR." Headline CPI "hovering around 3% … mainly because of persistently higher gasoline prices"; ex-gasoline 2.2% and core "close to 2%" in July. Guidance: "prepared to adjust monetary policy as needed." (Bank of Canada press release, Sep 2.)
- **Deliberations (Sep 2 summary):** no hike was discussed; the stated trigger is spillover — "If higher energy prices did spill over into other components of the CPI, members agreed that it could require a monetary policy response."
- **Data since:** StatCan CPI Aug (Sep 14): 3.0% y/y, unchanged from July; ex-gasoline 2.4% (from 2.2%); gasoline +22.8% y/y; core measure 2.4% from 2.3%. LFS Aug (Sep 4): employment −42k, unemployment 6.4%. GDP July (Sep 29): flat.
- **Rhetoric:** Macklem, Halifax Partnership, Sep 21: "We don't want to raise our policy rate and restrain growth if inflationary pressures are contained. But nor do we want to be too slow to respond if inflationary pressures are becoming more persistent"; "if oil prices stay near $100 per barrel, we would expect inflation to edge up in the coming months." Rogers (Oct 1, Victoria) spoke on housing, not on the October call.
- **Calendar before the decision:** LFS Sep (Oct 9); CPI Sep + Business Outlook Survey + Consumer Expectations survey (Oct 19). Brent fell to $97.97 on Oct 6 from ~$110 weeks earlier as Hormuz flows recovered (CNBC, oilprice.com).
- **Already happened?** No. Nothing is printed; the decision is three weeks out.

### Probability (committed before opening the book)

**Pre-market: 75% hold / 23% hike / 2% other.** Reasoning: the Bank moves by consensus, did not discuss a hike in September, keys off core (~2%) rather than gasoline-driven headline, faces flat growth, falling employment and escalating US tariffs, and the energy driver has eased since the hawkish speech. Against that, the Halifax speech is the most hawkish BoC language of the cycle, ex-gasoline and core are drifting up, and October is an MPR meeting where a first move is natural.

### Entry context (opened after committing)

| Leg | YES bid/ask | NO bid/ask | Last | Vol 24h | OI | Depth at/below limit |
|---|---|---|---|---|---|---|
| H0 (hold) | 79 / 81 | 19 / 21 | 79 | 6,356 | 44,115 | YES resting at 79: 203; 77: 150; 73: 324 |
| H25 (+25bp) | 20 / 22 | 78 / 80 | 21 | 596 | 34,238 | NO resting at 78: 34; 77: 261; 75: 114; 74: 500 |

| H0 close | YES | implied hike |
|---|---|---|
| Sep 8 | 87¢ | 13¢ |
| Sep 15 | 67¢ | 33¢ |
| Sep 23 | 57¢ | 43¢ |
| Sep 30 | 60¢ | 40¢ |
| Oct 2 | 70¢ | 30¢ |
| Oct 4 | 68¢ | 32¢ |
| Oct 6 | 71¢ | 29¢ |
| Oct 7 | 79¢ | 21¢ |

The hold leg fell from 87¢ (Sep 8) to 57¢ (Sep 23–25) on the Sep 14 CPI and Sep 21 speech, then recovered to 79¢ by Oct 7 as oil slid. Overnight index swaps on Oct 7 imply 72% hold / 28% hike (+7bp priced; bluegamma); a CORRA-spread-adjusted reading puts hike odds lower still. Nanos/Bloomberg (Oct 6): 54% of Canadians expect inflation above 3% within 12 months.

**Blend: 75% → 77% final for hold.** The book is liquid and specialist-dense (volume24h > 5,000 on H0) and sits within 3 pts of my number; nothing in the primary sources is specific enough to override it.

### Resolver risk (Stage 2.5)

Deduction 1 pt: the ladder is mechanically settled off a single primary-source number with two verified identical precedents (Jul, Sep) and no clarifications. No ambiguity on "hike of 0bps" = maintain.

### Stage 3 verdict

- **H25, NO @ 80¢ (core band).** Rejected: _continuation tail_. The cleanest loss is the Oct 19 CPI showing energy spillover into core — ex-gasoline and core are already drifting up — and the Bank acting on exactly the trigger it named. That is the current trend continuing, not a new discrete event. Secondary: _inside spread_ (78% model vs 80¢ ask; the leg has already moved 10¢ in my direction in 72 hours on the oil pullback, so I would be chasing).
- **H0, YES @ 81¢.** Side rule: allowed in principle as _process-in-motion_ (dated step on the Bank's official calendar; store shows the resolver pays on the hold). Rejected: _inside spread_ — 77% model vs 81¢ ask is negative edge, and the same continuation tail applies.

What would change this: a hold leg back near 65–70¢ on a hawkish Oct 19 CPI with core still near 2% (the Fed-July-2026 fade shape), or a BoC communication that explicitly tables a hike (the BoJ-June-2026 shape, which would make the hold leg a sell, not a buy).

## 5. Cluster table

| Cluster | Legs researched | Deployed | Outcome |
|---|---|---|---|
| `boc-oct28-decision` | H0 (YES), H25 (NO) | none | both rejected (continuation tail / inside spread) |

## 6. Position sizes, limits and EV (for the record)

No positions. For the record, had H25 NO cleared Stage 3 at 80¢: flat size 10% of capital = $250 → 312 contracts max cost, but the depth cap (1/3 of 34 + 261 + 114 contracts resting at 75–78¢) would have limited a fillable order to roughly 136 contracts at a 78¢ limit; EV at 78% ≈ −2.5% at the 80¢ ask, ≈ 0% at 78¢. Neither clears the no-trade band.

## 7. Rejected log (19)

| Market | Archetype | Side @ price | P(YES) | Reason |
|---|---|---|---|---|
| `KXCBDECISIONCANADA-26OCT-H25` Bank of Canada hikes 25bp at Oct 28, 2026 meeting? | scheduled-process | NO @ 80¢ | 22% | continuation tail: the cleanest loss is the Sep CPI (Oct 19) showing energy spillover into core (ex-gasoline already 2.2->2.4, core 2.3->2.4) and the Bank hiking at the Oct 28 MPR meeting - that is the current trend continuing, not a new discrete event. Also inside spread: NO ask 80c vs 78% final (pre-market 75%); hold leg already +10c in 72h on oil's slide to $98. |
| `KXCBDECISIONCANADA-26OCT-H0` Bank of Canada holds at 2.25% at Oct 28, 2026 meeting? | scheduled-process | YES @ 81¢ | 77% | inside spread: YES ask 81c vs 77% final (75% pre-market). Shape qualifies as process-in-motion (Oct 28 on the Bank's published calendar; store shows -26JUL-H0 and -26SEP-H0 paid on the hold), but OIS prices 72% hold and the leg is already +10c since Oct 4; no edge, and the same continuation tail applies. |
| `KXDIESELEXPORTBAN-26` US diesel export ban in effect before Nov 3, 2026? | multi-news-other | NO @ 96¢ |  | already an active pick (EXISTING_PICKS); also vol24h 476 < 500 live. |
| `KXCAWEALTHTAX-26` Will a one-time tax on billionaires ballot initiative in California pass? [In 20 | confirmation/enact | NO @ 68¢ |  | close after expiration: close_time 2027-11-03 is a year after expected_expiration 2026-11-03 (Anchor rule). Not researched; no probability formed. |
| `KXRETIREMM-26` Will Mitch McConnell resign his office early? [Before election day 2026] | departure/ouster | NO @ 98¢ |  | deep-favorite band: YES ask 1.9c -> NO side would cost ~98c (>=90c band). Stage-0 cut: yes_ask<=5. |
| `KXIMPEACH-27-JAN01` Will the President be impeached before Jan 1, 2027? [Before Jan 1, 2027] | legal-action | NO @ 97¢ |  | close after expiration: close 2027-01-01 vs expected_expiration 2026-11-03; also NO side ~96c (deep-favorite band). |
| `KXKASHOUT-26JUL-26NOV01` Will Kash Patel be out as FBI Director before Nov 1, 2026? [Before Nov 1, 2026] | departure/ouster | NO @ 99¢ |  | deep-favorite band: YES ask 3c -> NO side ~97c. Stage-0 cut: yes_ask<=5. |
| `KXIMPEACH-27-MAR01` Will the President be impeached before Mar 1, 2027? [Before Mar 1, 2027] | legal-action | NO @ 70¢ |  | close after expiration: close 2027-03-01 vs expected_expiration 2026-11-03; also beyond 45d horizon. |
| `KXLEAVEPOWELLGOV-28JAN31` Will Jerome Powell leave Member of the Board of Governors of the Federal Reserve | departure/ouster | NO @ 37¢ |  | close after expiration: close 2028-01-31 vs expected_expiration 2027-01-01; spread 10c; beyond horizon. |
| `KXIMPEACH-28-JAN01` Will the President be impeached before Jan 1, 2028? [Before Jan 1, 2028] | legal-action | NO @ 34¢ |  | close after expiration: close 2028-01-01 vs expected_expiration 2026-11-03; beyond horizon. |
| `KXMARENTCONTROL-26` Will the Massachusetts Rent Control Initiative in Massachusetts pass? [In 2026] | confirmation/enact | NO @ 95¢ |  | close after expiration: close 2027-11-03 vs expected_expiration 2026-11-03; spread 6.4c. |
| `KXTRUMPOUT27-27-JAN2029` Will Donald Trump leave office before January 20, 2029? [Before January 20, 2029 | departure/ouster | NO @ 78¢ |  | close after expiration: close 2029-01-20 vs expected_expiration 2027-01-01; beyond horizon. |
| `KXKASHOUT-26APR-27OCT01` Will Kash Patel be out as FBI Director before Oct 1, 2027? [Before Oct 1, 2027] | departure/ouster | NO @ 54¢ |  | close after expiration: close 2027-10-01 vs expected_expiration 2027-01-08; beyond horizon. |
| `KXIPOANTHROPIC-DATE-26NOV01` When will Anthropic officially announce an IPO? [Before Nov 1, 2026] | corporate-event | NO @ 96¢ |  | deep-favorite band: YES ask 5c -> NO side 95-96c. Stage-0 cut: yes_ask<=5. |
| `KXUSAIRANAGREEMENT-27-26NOV` Will the US agree to a new Iranian nuclear deal this year? [Before Nov 1, 2026] | scheduled-process | NO @ 98¢ |  | deep-favorite band: YES ask 3c -> NO side ~97c. Stage-0 cut: yes_ask<=5. |
| `KXIPOANTHROPIC-DATE-26OCT17` When will Anthropic officially announce an IPO? [Before Oct 17, 2026] | corporate-event | NO @ 100¢ |  | deep-favorite band: YES ask 1c -> NO side ~99c; closes in 10 days. Stage-0 cut: yes_ask<=5. |
| `KXCOMPANYACTIONMERGER-27-26NOV01` Will Tesla or SpaceX announce a definitive, binding agreement for Tesla to acqui | corporate-event | NO @ 97¢ |  | deep-favorite band: YES ask 5c -> NO side ~95c. Stage-0 cut: yes_ask<=5. |
| `KXHEGSETHOUT-26AUG-26NOV01` Will Pete Hegseth be out as Secretary of Defense before Nov 1, 2026? [Before Nov | multi-news-other | NO @ 97¢ |  | deep-favorite band: YES ask 4c -> NO side ~96c. Stage-0 cut: yes_ask<=5. |
| `KXUSAIRANAGREEMENT-27-27MAR` Will the US agree to a new Iranian nuclear deal this year? [Before Mar 1, 2027] | scheduled-process | NO @ 82¢ |  | close after expiration: close 2027-03-01 vs expected_expiration 2027-01-01; beyond horizon. |

## 8. Risk profile and execution notes

- Portfolio: 100% cash. No correlated exposure. Reserve requirement (≥10%) trivially met.
- Re-check triggers inside the horizon: Oct 9 LFS, Oct 19 CPI/BOS/CSCE (the only dated events that can reprice the one live cluster); any new "before Dec 1" tails listed in the allowlisted departure/legal series that open above 5¢ with volume.
- API notes confirmed this run: bare-cent fields are null, `*_dollars`/`*_fp` used throughout; candlesticks via `/series/{series}/markets/{ticker}/candlesticks`.

## 9. Sources

- Bank of Canada press release, Sep 2, 2026 — bankofcanada.ca/2026/09/fad-press-release-2026-09-02/
- Summary of Governing Council deliberations, Sep 2, 2026 — bankofcanada.ca/2026/09/summary-of-governing-council-deliberations-fixed-announcement-date-of-september-2-2026/
- Macklem speech, Halifax Partnership, Sep 21, 2026 — bankofcanada.ca/2026/09/speech-tiff-macklem-governor-bank-canada-2026-09-21/ (quotes via Bloomberg, Sep 21; Canadian Mortgage Trends, Sep 2026)
- Statistics Canada, The Daily: CPI August 2026 (Sep 14) — www150.statcan.gc.ca/n1/daily-quotidien/260914/dq260914a-eng.htm; LFS August 2026 (Sep 4); GDP by industry July 2026 (Sep 29)
- Bank of Canada release notice: Business Outlook Survey and CSCE, Oct 19, 2026
- bluegamma.io BoC forecast page (OIS-implied, as of Oct 7, 2026); D. Watt substack (Sep 22, CORRA-spread adjustment)
- Canadian Mortgage Trends, Oct 6, 2026 (Nanos/Bloomberg survey); CNBC Oct 6, 2026 and oilprice.com (Hormuz flows, Brent $97.97)
- Kalshi public API: markets, orderbook, candlesticks for KXCBDECISIONCANADA-26OCT-H0/H25 and settled -26SEP-H0/H25; internal precedent store (resolution_precedents, 162 rows).