Kalshi Study says most highly profitable prediction market traders lack Wall Street backgrounds

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Kalshi Research: 82%Highly profitable traders have no Wall Street experience, 91%and are not full-time traders

BlockBeats reports that October 10, a prediction market platform Kalshi released a study showing that its highly profitable traders do not generally come from traditional finance, and that trading performance may be more closely related to probabilistic reasoning ability.

The study surveyed highly profitable accounts in 2026 years September Kalshi across various markets (excluding sports and special categories), sending questionnaires to 2360 accounts and receiving 325 valid responses, for a response rate of 13.8%. The results showed that 82%of highly profitable traders had never worked full-time in investment banking, hedge funds, private equity, or proprietary trading firms; 79%had attended public high schools, 65%said they primarily learned about markets and probability through self-study, 91%were not full-time traders, and 42%had worked in customer service or retail for at least 6 months.

In cognitive ability tests, the surveyed traders had an average score of 2.42 points on the Berlin Numeracy Test (out of 4 points), compared with an average score of 0.62 points among a sample of average U.S. adults; the proportion of traders who resisted the “gambler’s fallacy” was 93%, compared with 57%among the general public. The study concluded that trading advantages in prediction markets may derive more from probabilistic reasoning, information research, and the ability to distinguish predictable from unpredictable events than from a traditional finance background.

In addition,Kalshi analysis of the traders’ places of residence found that only 6.3%of traders lived in ZIP code areas where the median household income exceeded 150000 USD. The overall user base had an income distribution closer to that of the U.S. middle-income population.

Original link https://m.theblockbeats.info/flash/371120

Key points

The study surveyed 2026 years September Kalshi of highly profitable accounts across various markets, excluding sports and special categories.
The study sent questionnaires to 2360 accounts and received 325 valid responses, for a response rate of 13.8%。
82%of highly profitable traders had never worked full-time in investment banking, hedge funds, private equity, or proprietary trading firms.
91%of surveyed highly profitable traders were not full-time traders.
65%of respondents said they primarily learned about markets and probability through self-study.
The surveyed traders’ average score on the Berlin Numeracy Test was 2.42 points, out of 4 points.
The study said that the proportion of traders who resisted the “gambler’s fallacy” was 93%, compared with 57%。
The study concluded that trading advantages in prediction markets may derive more from probabilistic reasoning, information research, and the ability to distinguish predictable from unpredictable events.
Only 6.3%of traders lived in ZIP code areas where the median household income exceeded 150000 USD.

AI-assisted interpretation

The following is analysis, separate from reported facts. Verify important claims independently.

This survey focused on Kalshi accounts with relatively high profitability. The results showed that most respondents had no full-time experience in the traditional finance industry and were not full-time traders; the study also reported that they performed relatively well on probability-related tests.

Why it matters to readers

It suggests that trading performance in prediction markets may be related to abilities such as probabilistic reasoning and information research, but the study focused on highly profitable accounts and cannot directly represent all traders.

The “gambler’s fallacy” is the incorrect belief that the probability of a random event changes because of previous outcomes—for example, believing that after the same outcome occurs several times in a row, the next outcome must be the opposite.

Risks and unknowns

The evidence is BlockBeats’ account of the Kalshi study; it does not provide the Kalshi complete original research report.
Valid responses accounted for only the share of accounts that received the questionnaire 13.8%, and nonrespondents may differ from respondents.
The sample came from highly profitable accounts, so the results cannot be directly generalized to Kalshi all users or ordinary traders.
The evidence does not specify the precise screening criteria for highly profitable accounts or the complete questionnaire.

Kalshi Study says most highly profitable prediction market traders lack Wall Street backgrounds

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