Kalshi weather markets
How weather markets work on Kalshi: temperature and climate outcomes, how they settle against official data, and what makes these markets distinctive.
What weather markets are on Kalshi
Kalshi offers contracts on weather outcomes, such as whether a city's high temperature lands in a given range on a given day.
They are a distinctive Kalshi category, appealing to traders who can model short-term forecasts.
How to think about weather markets
Settlement is a single official reading, not how it felt outside. A weather contract resolves on a specific station's number, often one airport sensor, against an exact threshold, so the precise source and cutoff matter more than the general forecast. Read the settlement terms first.
Forecasts converge as the date nears, so timing is everything. An edge a week out is mostly noise; the real, tradable information arrives in the final days as models agree. The interesting markets are the longer-dated ones where genuine forecast uncertainty still exists.
Mind microclimates and the exact metric. A city's official high is one location's reading, and whether a contract is about temperature, rainfall totals, or snowfall changes which forecast actually matters. Match your information to the precise thing being settled.
How they settle
Weather contracts settle against an official data source for the location and date, paying $1 for the correct range and $0 otherwise.
The settlement source is defined in the market, so the resolving figure is objective.
What moves the prices
Forecast updates drive weather prices, which tighten as the date approaches and the forecast firms up.
Because the outcome is data-driven and modelable, edges come from forecasting skill rather than reaction speed.
Sizing and taxes
Whatever you trade, position sizing is your real risk control: Kalshi has no native stop-loss, so risking only a small percent of your bankroll per market is what keeps a cold streak survivable.
On taxes, these gains are event-contract income, not automatically gambling. The treatment (ordinary, Section 1256, or gambling) is unsettled and can change your bill, which is worth understanding before filing.