Trading
Slippage
The difference between expected execution price and the actual fill price after placing an order.
Detailed explanation
Slippage is the angle between intention and execution price when a Kalshi order fills at a different price than expected. It happens when market conditions move, or when there isn’t enough liquidity to fill the order at your chosen price. On Kalshi, where each binary market has YES and NO sides priced in cents, slippage is most evident for larger orders, times of high volatility, or when the order book depth is thin. Slippage reduces the edge of a pre-placed arbitrage and can be amplified by latency and fee costs, so traders should consider order size, timing, and the current liquidity when planning fills.
In practice, slippage is a real, not theoretical, cost. Even with a well-timed dual-leg position, you may see your YES fill at a higher price and your NO fill at a higher price than intended, moving your total cost closer to $1.00 and narrowing or eliminating the guaranteed edge. Monitoring liquidity, choosing appropriate order types, and accounting for Kalshi’s fee curve help manage the slippage risk in intra-market arbitrage strategies.
Worked example
Suppose you target buying YES at 42¢ and NO at 56¢ (total 98¢) to secure a 2¢ edge. If market activity shifts and the fills come at 43¢ for YES and 57¢ for NO, your total cost becomes 100¢. That 2¢ slippage eliminates the edge before fees, illustrating how price moves between quote and fill impact profitability.
FAQ
- What causes slippage on Kalshi?
- Slippage is caused by rapid price moves, limited liquidity, and order-book dynamics that move fills away from your target prices, especially for larger or time-sensitive orders.
- How can I reduce slippage?
- Trade smaller sizes, use limit orders with attention to depth, time your orders during liquidity peaks, and consider splitting orders across multiple events or moments to avoid mass price impact.
- How is slippage different from fees?
- Slippage is the price movement between order placement and fill; fees are a separate per-fill cost. Both reduce edge, and both should be factored into profitability estimates.
See Slippage on a live Kalshi market
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Related terms
- LiquidityLiquidity is the ease of buying or selling a contract without moving the price much.
- SpreadThe gap between the best bid and best ask on a contract side.
- Limit OrderAn order to buy or sell at a specified price or better, not at market.
- Market OrderAn order to buy or sell at the best available price, immediately; may incur slippage.
- Fill-or-Kill OrderAn order that must be fully filled immediately or cancelled in its entirety.