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Comment by LeifCarrotson | Hacker News Reader

I'm a little confused by the "Yes" versus "No" asymmetry.

For example, one of the top trending ~~bets~~ markets right now is on whether Miami or Indiana will win the NCAA football championship tonight. You can either take "Yes" on Indiana at 74c, or "No" at 27c, or you can take "Yes" on Miami at 27c or "No" at 74c. Or, there's another potential outcome - you can also bet on a tie at 10c yes/91c no.

Is this research suggesting that an optimistic Miami fan can somehow get a better return by buying "No" on Indiana than a "Yes" on Miami?

Why is Kalshi structured with these yes vs. no options for all outcomes?

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> Why is Kalshi structured with these yes vs. no options for all outcomes?

it's basically how they do margin. otherwise you wouldn't be able to sell / post asks without already having a long position. for kalshi, it's actually one single security in the background they just present it as two order books (but really it's one). for polymarket, they are two distinct products that trade separately, and technically could have arbitrage between them. although in practice they're normally priced correctly to sum to 1 (or 1.01)

It’s not really margin since there’s no leverage: the potential loss associated with the bet has to be deposited, so it’s fully collateralised.

right, I guess I should have said it's what they have _instead_ of letting users trade on margin.

Part of this perceived arbitrage is the fee structure. Kalshi has a weird transaction cost structure but taking advantage of that 1c arb probably costs you 2c in fees to Kalshi, so nobody does it.

This is incorrect and tiresome to constantly hear as a go-to explanation for supposed market inefficiencies.

10c yes seems really high for a tie. NCAA rules don't allow for ties in football. I know prediction markets have very long shot bets but I would expect that to be closer to 1c

Edit: it looks like the tie market is only for if the game is tied at halftime, which makes much more sense

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