Betting mathematics
Prediction Market Calculator: Contract Cost & Return
Calculate the cost and settlement outcomes of buying a binary contract that pays $1 if your selected side wins and $0 if it loses. Enter the actual price and fees.
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From contract price to potential payout
For N contracts bought at c cents, entry cost before fees is N × c ÷ 100. A selected side settling at $1 returns N dollars; one settling at $0 returns zero. Net result subtracts the purchase cost and the total fees you enter. The calculation works for either a bought Yes or a bought No side when its own purchase price is entered.
At 40 cents, 100 contracts cost $40 before fees. With $1 total fees, net is $59 on a $100 winning settlement and −$41 on a losing settlement. This models holding a purchased side to resolution, not short selling, leverage or an early sale.
Break-even probability and fees
Break-even probability equals total modeled cost divided by the $1-per-contract winning return. The example’s $41 cost divided by $100 gives 41%. Without fees, the 40-cent purchase price corresponds to a 40% break-even threshold. A market price is not proof of the event’s true probability.
If you have an independent probability estimate, the expected value calculator explains how assumptions affect a modeled return. Do not use a fee-free equivalent quote as if it included platform charges.
Resolution and fee assumptions
Check the contract’s exact resolution wording and the applicable fee schedule yourself. Fees can depend on price, order type or execution; liquidity and spreads also matter. This calculator assumes fixed binary $1/$0 resolution and a single supplied total fee. Refunds, ambiguous resolutions, changing fees and partial executions are not modeled. No exchange account or live market feed is connected.
Convert contract cents to betting odds
Before fees, decimal odds equivalent to a bought $1 contract are 100 divided by its price in cents. A 40-cent contract therefore corresponds to decimal 2.50, American +150 and fractional 3/2. These conversions describe its conditional payout, not a verified forecast. The result panel converts the entered price automatically.
Fees raise the break-even probability and reduce the return on total cost. In the worked example, $59 winning net divided by $41 total cost is about 143.90%. If total cost exceeds the maximum $100 settlement, even a winning resolution loses money. Compare identical contract wording, settlement timing, available size and total fees; a differently defined event is not an equivalent price.
Methodology and references
For the underlying terminology, see Kalshi explanation of binary event contracts. This independent calculator uses the assumptions explained above; check your operator’s current settlement terms. The reference is not an endorsement or an account integration.