Political betting odds are a probability with a trading cost attached. On a prediction market such as Polymarket, each share is priced between $0.00 and $1.00, so the price already reads as a percentage; on a fixed-odds book the odds must first convert to an implied probability and then lose the bookmaker's margin. What a price move says about an election depends on whether it clears the spread and the fee that sit between the quote and a filled trade.
How do political betting odds convert to implied probability?
Implied probability is the stake divided by the total return on a win, stake included. That works the same for fractional, decimal and American odds once they are written as stake against total return.
A prediction market skips the step. A Polymarket share pays out in full if the outcome happens and nothing if it does not, and the price reflects the market's probability belief. A share at $0.37 is a 37% read (as of November 2026). The work starts after that: deciding which of the several prices on screen is the real one.
How do you strip the margin out of political betting odds?
On a fixed-odds book, add the implied probabilities of every candidate in the race. The total runs above a full book, and the excess is the margin. Divide each candidate's implied probability by that total and the results add back to a full book: that is the fair probability the price implies.
Prediction markets carry no overround in the quote. The margin sits in two other places, the bid-ask spread and the taker fee, which is the same split covered in the note on prediction markets vs sports betting vig. Stripping it means reading the midpoint and then pricing the fee at the level where a trade would actually fill.
What does a Polymarket political price actually display?
The number on a Polymarket market page is the midpoint of the bid-ask spread, not the last trade. The exception matters for thin political contracts: when the spread is wider than $0.10, the page shows the last traded price instead (as of November 2026).
The documentation's own example: a best bid of $0.34 and a best ask of $0.40 display as $0.37, a 37% probability. Nobody trades at $0.37. A buyer pays the ask, a seller gets the bid, so the cost of acting on that 37% read is the distance to $0.40 on the way in.
The wide-spread rule is where political markets mislead. A down-ballot race or a long-dated contract with a gap above $0.10 shows whatever traded last. The headline percentage can then sit outside the live bid and ask entirely.
What do fees cost on political markets?
Fees decide how far a price has to move before the move is worth anything. The two largest US-facing venues charge them differently.
| Venue and category | Who pays | Fee basis | As of |
|---|---|---|---|
| Polymarket, politics | Takers only | Rate 0.04, with a 25% maker rebate | November 2026 |
| Polymarket, geopolitics and world events | Nobody | Fee-free | November 2026 |
| Kalshi, election markets | Per market schedule | Fee on expected earnings, can differ from other markets | April 2026 |
Polymarket's taker fee formula is fee = C × feeRate × p × (1 - p), where C is the number of shares and p the price. Makers are never charged: a resting limit order that gets filled pays nothing. Politics markets use the 0.04 politics taker rate, while geopolitical and world events markets are fee-free (as of November 2026). The same read on a candidate and on a ceasefire therefore costs different amounts to act on.
The p × (1 - p) term makes the dollar fee symmetric around 50%: a trade at 30¢ costs the same as one at 70¢, and the fee is largest in the middle of the range. Close races, the ones political readers watch, are where taking liquidity costs the most.
Kalshi takes a transaction fee on expected earnings, and says special events such as an election can carry fees that differ from its other markets (as of April 2026). Maker fees there apply to resting orders that later execute, and cancelling a resting order is free.
What does a price move say about an election?
A political price move carries information when it crosses the old bid or ask, not when the midpoint drifts inside them. Three checks sort a real move from noise:
- Is the spread under $0.10? If not, the displayed price is a last trade and may not reflect any current order.
- Did the move cross the prior quote? A midpoint that shifts from $0.37 while the bid stays at $0.34 and the ask at $0.40 says less than a trade through either side.
- Does the move exceed the fee at that price? Near 50% the taker fee is at its peak, so a small move in a close race may not cover the cost of acting on it.
When a move passes all three, it is the crowd repricing the race, and the evidence on that crowd is reasonably good. In the Journal of Economic Perspectives, Wolfers and Zitzewitz found market forecasts are typically fairly accurate and outperform most moderately sophisticated benchmarks. That is a statement about averages across many markets; any single price can still be wrong, and none of it implies a profitable trade.
The same mechanics run through world cup prediction markets and the rest of the prediction markets sector. For the legal side of why these contracts trade as event contracts in the US, see how prediction markets are not gambling under CFTC rules.
Sector questions
Is the Polymarket price the probability of a candidate winning?
It is the market's priced estimate, not a forecast with a guarantee. Shares run from $0.00 to $1.00, so a $0.37 midpoint reads as 37%, and that number is only as current as the spread allows.
Why does a political market show a price nobody can trade at?
The displayed figure is the midpoint of the best bid and best ask. A buyer pays the ask and a seller receives the bid, so a fill always lands on one side of the number on screen.
Are fees on election markets the same as on other markets?
Not always. Polymarket applies a 0.04 taker rate to politics while geopolitical and world events markets are fee-free, and Kalshi notes that election markets can carry fees different from its other markets.
Are prediction market odds accurate on elections?
Academic work by Wolfers and Zitzewitz found market forecasts are typically fairly accurate and beat most moderately sophisticated benchmarks. That is a finding about averages, not a promise about any single race.
Data sources
- Polymarket Documentation, Prices & Orderbook, accessed 2026-11-03
- Polymarket Documentation, Trading Fees, accessed 2026-11-03
- Kalshi Help Center, Fees, 2026-04-19
- Journal of Economic Perspectives (Wolfers and Zitzewitz, 2004), Prediction Markets, 2004-05-01
