8Factor Report #5: Peltola Trails the Count. The Market Has Her at 85%.
Dan Sullivan leads Alaska's first-choice count by under a point with 80,000 ballots still out, and the ranked-choice math leans his way. Kalshi and Polymarket still price Mary Peltola at 84–87%. We graded the market and then tried to break our own call.
*Predictagon 8Factor Report · No. 5 · November 4, 2026 · Read-only analysis. Not financial advice.*
The market at a glance
| Kalshi | Polymarket | |
|---|---|---|
| Mary Peltola (D) | 86¢ bid / 87¢ ask | 84.1¢ bid / 84.8¢ ask |
| Dan Sullivan (R) | 13¢ / 14¢ | 14.4¢ / 16.0¢ |
| Volume | ~12.7M contracts across both sides; ~5.9M in the last 24h | ~$4.65M lifetime; ~$1.89M in the last 24h |
Trade it on Polymarket → · Trade it on Kalshi →
The 8Factor scorecard
| Factor | What it asks | Grade |
|---|---|---|
| 1 · Compare | Do the venues disagree? | C |
| 2 · Fair value | What's the real probability? | C+ |
| 3 · Net edge | Is anything tradable after costs? | B |
| 4 · Timing | When does it close, and how long is money stuck? | B+ |
| Red team | Outstanding geography · Second choices · Two Sullivans · Resolution | 4 live risks |
Verdict: no arbitrage, but the market looks too sure. The venues sit within about two points of each other, so there is nothing to lock. Against the count and the ranked-choice math, though, 85% looks rich. Our fair value for Peltola is 68%, which makes Sullivan at 14–16¢ the value side. It also makes this the lowest-confidence call in the sprint (see Red 1).
Why this market, why now
Election night settled the big questions. Democrats won control of the Senate and the House, and flipped seats in Ohio, North Carolina, Texas, Iowa and Kansas. Alaska is one of two Senate seats still uncalled, and it now decides the size of the majority, not who holds it.
As of NBC's 6:03 AM ET update, with 72.4% of the expected vote in (about 80,000 ballots remaining):
| Candidate | First-choice share |
|---|---|
| Dan Sullivan (R, incumbent) | 48.5% |
| Mary Peltola (D) | 47.7% |
| Gerald Heikes (R) | 2.2% |
| Dan J. Sullivan Jr. (independent) | ~1.7% (election-night reports) |
The lead changed hands during the night. Peltola led early, and Sullivan pulled ahead after midnight. Overnight reporting put the gap at about 1,700 votes out of roughly 208,000 counted.
Nobody is above 50%, so Alaska's ranked-choice tabulation decides it on November 18. Mailed ballots postmarked by Election Day are accepted for 10 days (15 from overseas), and certification is targeted for November 25.
So the question is simple: why does a candidate trailing on first choices, in a count where the minor-party second choices lean the other way, trade at 85%?
Factor 1 · Compare: Grade C
Question: do the venues disagree on the same outcome?
Not by much. Kalshi's Democratic contract is 86/87¢ and Polymarket's Peltola contract is 84.1/84.8¢, a gap of about 2 points. One nuance: Kalshi's market resolves on the winning party, while Polymarket's resolves on the named candidate. Here they are the same thing, since Peltola is the only Democrat on the ballot.
There's no venue edge. Both books moved together all night, and both are deep: Polymarket did nearly $1.9 million in 24 hours.
Factor 2 · Fair value: Grade C+
Question: setting the order books aside, what's the real probability Peltola wins after ranked-choice tabulation?
> AI fair value (Peltola): 55% low · 68% mid · 80% high. Confidence: C+.
The ranked-choice math leans Sullivan. Under Alaska's system, last-place candidates are eliminated and their ballots move to each voter's next choice. Two of them matter:
On those assumptions, transfers add about 2 points net to Sullivan's lead, on top of his 0.8-point first-choice edge. That's a final-round gap of roughly 2.9 points on the ballots counted so far, about 5,900 votes.
What Peltola needs from the outstanding vote. With about 80,000 ballots left, she has to win the final-round share of the remaining vote by roughly 54/46. That's a 7- to 8-point lean in a race where the counted vote has her 0.8 points behind on first choices.
Why that's possible:
Why 85% is too sure:
Divergence:
| Venue | Market (Peltola) | AI mid | Divergence |
|---|---|---|---|
| Kalshi | 86.5¢ (mid) | 68% | −18.5 pts (market too confident) |
| Polymarket | 84.45¢ (mid) | 68% | −16.5 pts |
Flipped around, we put Sullivan at about 32% against a market price of 13–16¢.
Factor 3 · Net edge: Grade B
Net Edge = divergence × log10(volume + 1)
The cross-venue lock (per $1 payout):
| Step | Cents |
|---|---|
| Buy Sullivan (R) YES on Kalshi | 14.0 |
| Buy Peltola YES on Polymarket | 84.8 |
| Total cost | 98.8 |
| Gross locked profit | +1.2 |
| Kalshi fee (≈ 0.07 × P × (1−P) at P = 0.14) | −0.8 |
| Polymarket fee (model assumption 2%) | −1.7 |
| Predictagon buffer | −1.0 |
| Net edge | ≈ −2.3 → PAPER |
There's no arbitrage.
The directional trade is where the grade comes from. Sullivan at 14–16¢ against a 32% fair value is roughly a 100% expected-value cushion on the stake, and both books are deep enough for normal sizes. It's a B, not an A, because our confidence is only C+: the whole edge rests on transfer assumptions and on what the outstanding ballots look like, and the market may know more about the second than we do.
Factor 4 · Timing: Grade B+
Short clock and frequent updates, but resolution could slip if the count is challenged: B+.
The Red Team: four ways this call breaks
Our call is "the market is about 17 points too confident in Peltola." Here's how that's wrong.
Red 1 · The outstanding vote is Peltola country
The market isn't guessing blind. Traders watching precinct reporting may know that the uncounted ballots come disproportionately from places Peltola wins by 20 or 30 points. If so, a 7–8 point lean in the late vote is the base case, not a stretch, and 85% is fair. This is the most likely way our analysis is wrong.
Watch: which regions report in the next count updates, and Peltola's first-choice share in them.
Red 2 · Second choices don't break the way we assume
Our transfer split is an assumption. Many Heikes voters may rank nobody else, and if Dan J. Sullivan Jr.'s voters were protest votes rather than confusion votes, they could split evenly or exhaust. If transfers are close to neutral, Sullivan's real final-round edge is under a point, and the late vote only has to lean modestly toward Peltola.
Watch: the November 18 round-by-round tabulation, and any exit data on how minor-candidate voters ranked.
Red 3 · The two Dan Sullivans
A second candidate named Dan J. Sullivan is on the ballot. If the final margin is smaller than his vote total, expect legal arguments that the ballot confused voters. That cuts both ways: it adds delay and a real chance that a court, not the count, decides the outcome.
Watch: any lawsuit over the ballot listing, and the size of Dan J. Sullivan Jr.'s final total compared with the margin.
Red 4 · The plumbing: resolution and certification
Kalshi resolves on the winning party and Polymarket on the named candidate. Both follow certified results, but a contested certification or court challenge can hold money past November 25, and the venues' delay clauses may not match.
Watch: each venue's resolution source and deadline language before trading.
Bottom line
| Cross-venue signal | PAPER (venues within ~2 pts) |
| Directional view | Sullivan underpriced: fair ~32% vs market 13–16¢ |
| AI fair value (Peltola) | 68% (band 55–80%) |
| Clock | 14 days to tabulation (Nov 18), certification Nov 25 |
| Biggest risk | Red 1: the outstanding ballots are heavily pro-Peltola |
The market reads the outstanding vote as decisive for Peltola. It may be right, since rural Alaska has carried her before. But she trails on first choices, the ranked-choice transfers lean the other way, and a 7–8 point lean in the late vote is a lot to price at 85%. If the next count updates show rural ballots closing the gap fast, we'll re-grade and move toward the market.
New 8Factor Reports publish every week at Predictagon.com/8Factor.
Data notes and methodology
Sources: NBC News: Alaska Senate results · Alaska Beacon: Senate race a tossup as more votes are counted · Alaska Public Media: Sullivan and Peltola locked in tight race · CBS News: How ranked choice works with two Dan Sullivans on the ballot · Polymarket: Alaska Senate Election Winner