Question 1

How do Kalshi weather markets work?

Accepted Answer

Kalshi weather markets are CFTC-regulated binary contracts tied to daily temperature outcomes in major U.S. cities. Each market is divided into 2°F brackets. You buy YES if you think the temperature will land in that range, or NO if you think it won't. YES and NO prices add up to roughly $1. If you buy YES at 30¢ and the temperature lands in your bracket, you collect $1. Markets settle based on the official NWS Daily Climate Report, not weather app readings.

Question 2

What data do Kalshi weather contracts settle on?

Accepted Answer

Kalshi weather contracts settle on the official National Weather Service Daily Climate Report, which is issued the following morning. The report pulls temperature data from ASOS (Automated Surface Observing Systems) stations at major airports. These readings can differ from consumer weather apps due to Celsius-to-Fahrenheit conversion rounding and different time windows.

Question 3

How do you find an edge in weather prediction markets?

Accepted Answer

Edge in weather markets comes from identifying when the market's implied probability for a temperature bracket differs from your own probability estimate. This requires building a forecast baseline using NWS data, understanding forecast accuracy and biases by city, tracking real-time temperature pace against expectations, and sizing positions based on the magnitude of the edge rather than gut conviction.

Question 4

Can you make money trading weather on Kalshi?

Accepted Answer

Weather markets on Kalshi are beatable for traders who approach them systematically. The core data is publicly available through the National Weather Service and ASOS stations. The edge comes from processing that data more rigorously than other market participants, tracking forecast biases by city, and applying disciplined position sizing. Most participants trade on gut feel or a quick weather app check, which creates persistent mispricings for systematic traders to exploit.

Question 5

What is Weather Edge Finder?

Accepted Answer

Weather Edge Finder is a market scanner and expected value analysis tool for Kalshi temperature prediction markets. It blends NWS forecast data with live market pricing to build probability distributions for each city's temperature outcome, then identifies brackets where the model's probability diverges from the market price. It surfaces trades with positive expected value, ranked by EV, with position sizing guidance based on your bankroll.

Question 6

What is expected value in weather trading?

Accepted Answer

Expected value (EV) is the average profit or loss you'd expect per trade over many repetitions. In weather markets, EV is calculated by comparing your model's probability for a bracket against the market price. If your model says a bracket has a 40% chance of hitting and the market is selling it at 25¢, the expected value is positive. Profitable weather traders focus on EV rather than trying to predict exact temperatures.

Weather Edge Finder: Data-Driven Prediction Market Analysis