A Bloomberg analysis published on 7 October found a clear pattern in trading on Kalshi and Polymarket: users flock again and again to cheap longshot contracts — the kind that promise returns of 1,000% or more — even though those contracts lose the overwhelming majority of the time.[1]
What longshots are
A longshot is a contract priced at just a few cents: a 3¢ "Yes" on an unlikely event pays $1 if it happens — about 33 times your stake back, or a profit of roughly 32 to 1. The appeal is obvious. The problem is that buyers tend to overpay for them. Economists call this the favourite–longshot bias, and it's been documented in horse racing and sports betting for decades.
Why longshots are a bad deal
- Overpricing: if a 3¢ contract really has a 1.5% chance, buyers lose half their money on average over time.
- Spreads: a contract quoted 2¢ bid / 4¢ ask has a spread worth half its value.
- Fees: even small per-contract fees are a big share of a tiny price.
What it means for you
If you enjoy the occasional longshot, treat it like a lottery ticket: a small, fixed amount you're happy to lose. If you want to trade more seriously, focus on markets where you have a real view and the price is near the middle of the range. Our guide to implied probability and calibration explains the bias, and the edge calculator helps you test whether a price is really cheap.
Sources
- Kalshi, Polymarket bettors gamble on longshots for 1,000% returns — Bloomberg, 7 October 2026 ↩
