How Event Contract Bundles Inflate Prediction Market Volume

Highlights

Event contract bundles, known as combos, have become a significant source of reported volume on Kalshi and Polymarket, particularly during the NFL season. These multi-outcome bets pay only when every included contract wins, and can generate large notional-volume figures even when the cash staked is small. On Kalshi, combos represented 58% of September trading volume but less than 13% of transactions. Analysts say this makes comparisons with sportsbook handle difficult because the two industries measure activity differently. Headline volume can substantially exceed the cash traders actually put at risk. Some market participants therefore favor taker volume as a more informative measure of demand.

Sentiment Analysis

• The article presents a mixed, analytical view of combo contracts. Their popularity and contribution to platform volume indicate growing interest in prediction markets, especially for sports-related events during the NFL season.
• At the same time, the account raises concerns about how volume is calculated. Because a combo can pay out much more than its initial cost, a relatively small stake may correspond to a large reported notional figure. The article suggests that these figures could give an incomplete impression of market scale when compared with sportsbook handle.
• It includes differing perspectives: an analyst says the figures can make activity appear larger, while Kalshi says its standard measure does not overstate activity and users can consult other metrics. Polymarket’s representative endorses taker volume as a useful way to assess demand.
• Overall sentiment: mixed and cautious. The piece recognizes product growth while emphasizing measurement differences and the need to interpret headline figures carefully.

Article Text

Combo contracts, which bundle multiple event contracts into a single position, have become a prominent source of reported activity on prediction markets. A combo pays out only if every outcome included in the bundle is correct. The structure resembles a parlay in traditional sports betting, where a bettor combines several selections and must get them all right to receive a payout. The contracts have gained attention as prediction markets expand sports-related offerings.

On Kalshi, combos accounted for more than 50% of notional volume last month, during the opening of the NFL season. The source also reports that combos made up 58% of Kalshi’s trading volume in September. Most combos consist of combinations of sports contracts. Sports are not the only category in which the bundled contracts matter: on Kalshi, combos outside sports collectively accounted for over 35% of total volume share, according to the source.

Polymarket also made combos a priority as it expanded its U.S. exchange. Following the domestic platform’s official launch in May, the company developed the feature as part of its U.S. offering. Combos now represent nearly 50% of daily volume on Polymarket U.S., with growth helped by the NFL season. These proportions show that bundles can make up a substantial share of reported volume, but do not by themselves indicate how many individual trades or how much cash traders have committed.

The distinction arises partly from the way event-contract volume is counted. The Commodity Futures Trading Commission (CFTC), the federal regulator overseeing prediction markets, requires exchanges to report volume using a framework in which a trade is measured as $1 of notional volume, regardless of the cash a trader puts down. Event contracts have binary outcomes between $0 and $1. A trade also has another side, taken by a counterparty, so the reporting convention can record volume associated with both sides of market activity.

Combos complicate interpretation because their potential payouts can be much greater than $1. A participant may stake only a small amount—sometimes pennies—on a contract with a large possible payout. Market makers who take the other side of these trades can contribute to reported notional volume figures that are large in relation to the cash involved. Chris Park, a researcher and founder of MSR Decode, a firm that analyzes prediction-market data, said multi-leg contracts help platforms claim a higher figure with lower realistic cash output.

A CNBC analysis of Kalshi trades on Sept. 27 illustrated the difference in average cash placed per contract. For single contracts, the average amount was less than 47 cents. For combo contracts, the average was about 9 cents per contract. Data on Dune showed a similar gap between reported volume and transaction count: combos made up 58% of Kalshi’s trading volume in September but less than 13% of its total transactions.

These measurement differences matter when comparing prediction markets with online sportsbooks. A sportsbook’s “handle” is the total dollar amount wagered. Prediction markets, by contrast, count both sides of a trade under their volume conventions. As a result, the two measures do not necessarily describe equivalent activity. Ian Moore, an analyst at Bernstein, said he had spoken with investors who compare prediction-market notional volume with sportsbook handle and conclude that prediction markets have already surpassed the scale of sports betting.

Rich Jaycobs, an independent advisor to prediction markets seeking CFTC approval, said the reported dollar volume for a deep out-of-the-money contract or a combo may be anywhere between 20 to 100 times greater than sportsbook figures for what he described as the same basic bet. He attributed the difference to CFTC reporting requirements and the different way sportsbooks report activity. The article notes that rising interest in prediction-market sports contracts has also coincided with pressure on traditional online sportsbook companies. FanDuel parent Flutter Entertainment and DraftKings saw their stocks plunge 70% and 45%, respectively, over the past year. Some observers caution that activity measures may not be comparable.

Kalshi disputed the idea that its notional-volume measure overstates activity. Spokesperson Jack Such said that people interested in other measurements can look at other metrics. While notional volume remains the standard measure for prediction markets, some participants argue that taker volume offers a clearer view of demand. Takers use liquidity provided by market makers rather than supplying liquidity themselves, so their activity can help indicate where traders are choosing to transact.

Polymarket supports using taker volume to assess demand for combo bets. Its head of revenue and analytics, Kyle Gesuelli, said the company looks at taker volume for purchases of “yes” on combos. That measure reflects demand for bets on which all combined outcomes must occur. The core issue is not simply whether volume is rising, but which measurement best represents the underlying activity. The source also discloses that CNBC and Kalshi have a commercial relationship involving customer acquisition and a minority investment.

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