How Accurate Were Kalshi's Election Predictions? A Look at Three Key California Congressional Races

In the weeks leading up to California's June 2 primary, Elk Grove News was closely monitoring the Kalshi Prediction markets for three California-watched Congressional races. Those races were for the 6th, 7th, and 22nd districts.

Among the many reasons for monitoring these three races was to see how well Kalshi participants predicted voting outcomes. As outlined in this recent CNN story, the idea of prediction markets originated as an academic study based on the premise that collective knowledge could be harnessed to forecast outcomes in events, including elections.

With that premise, how well did the prediction markets for these three races perform? In our analysis, the results were mixed.

Although results have not been certified, the current standings are unlikely to change.

6th District

Of the three races we followed, Kalshi performed best in predicting the open seat in the 6th District. As predicted, Kalshi participants accurately predicted that current 3rd Congressional District Congressman Kevin Kiley would come in first place and Democrat and former State Senator Dr. Richard Pan would come in second.  

Beyond predicting the top two finishers, Kalshi also predicted the collapse of support of Sacramento County District Attorney and Democratic candidate Thien Ho. Although Ho was initially predicted to be a potential top-two finisher, sentiment turned against him several weeks before the election. In that regard, this market foresaw Ho's collapse.

Ho finished in a surprisingly low fifth place behind relatively unknown candidate Lauren Babb Tomlinson in a seven-candidate race. Even though Ho had a slew of high-profile endorsements and was considered an early favorite, pre-election polling showed his candidacy did not capture support beyond establishment Democrats.  

7th District

This high-profile race saw 10-term Democratic incumbent Doris Matsui challenged by fellow Democrat and Sacramento City Councilmember Mai Vang. In this market, Kalshi was 1-for-2 in its predictions.

The participants correctly wagered that Matsui and Vang would advance from the primary to the November general election. When it came to predicting first place, it struck out.

Conventional wisdom and participants in this market confidently predicted, at times as high as 95 percent certainty, that Matsui would finish first. As noted, results are not finalized, but it appears Vang's first-place finish over Matsui will hold.

22nd District

Much like the 6th District, which had an incumbent, albeit from another district, in the race, participants in the market correctly predicted Republican Congressman David Valadao would advance and come in first place.  

As for the other two Democratic candidates, California Assemblymember Jasmeet Bains and Randy Villegas, the market accurately predicted Villegas would advance. There were a few wrinkles in this race of interest.

In the weeks leading up to the election, Bains and Villegas traded positions for second place. The pivotal event that changed the dynamics came after Bains received a significant endorsement.

On May 4, the Democratic Congressional Campaign Committee (DCCC) endorsed Bains. That pushed her ahead of Villegas, and it was a position she would hold, although it narrowed with each day before June 2.

To the surprise of the prediction market, Villegas came in second place over Bains by a significant amount. Villegas, who is affiliated with other Democratic Socialists, was perhaps a harbinger of what happened in yesterday's Congressional New York City primaries, where three Democratic Socialists endorsed by Mayor Zohran Mamdani won, two of whom were against incumbent Democratic congressmembers.  

Additionally, it has been suggested the DCCC endorsement hurt more than helped Bains. It will be notwoerthy to see if this development along with the New York City results will be factors in predictions markets as the November elections approach.

The Kalshi markets were correct in two of their three predictions of the top two finishers, and two-for-three in who would be in first place. The final test for the accuracy of these markets in these three races will be the November elections.