Silver Edge
Same underlying. Two pricing channels. We surface the gap on every active Kalshi silver strike, daily.
What Is the Silver Edge Tool?
Kalshi's weekly KXSILVERW market settles on Pyth Network's XAG/USD feed every Friday at 5pm ET. SLV options on the same underlying settle through a different channel with a different mechanism but the same number. The Silver Edge tool extracts the probability the options market is implying, compares it to the Kalshi YES contract price on every active strike, and flags the gaps.
The free tier shows the headline — spot, ATM IV, hours to close, and the direction of today's top edge. The Pro grid below shows every strike with the signed edge in percentage points, the rationale, and direct trade links to Kalshi (with referral) and Robinhood (for the SLV options hedge).
How to Use It
Start with the HIGH confidence rows — those passed all four liquidity guards (edge, distance from spot, spread, volume). Cross-check the rationale for any caveat. Click through to Kalshi to verify the live book before sizing. Then optionally enter the matching SLV option on Robinhood as a directional hedge.
Direction-only preview. The full strike grid — edge in pp, confidence tier, rationale, and Kalshi/Robinhood links — is available with Pro.
Methodology
- Settlement source. Kalshi's KXSILVERW weekly silver market settles on Pyth Network's XAG/USD feed at 5:00 PM Eastern on Friday. We pull the same Hermes feed for our spot reference price, so the snapshot's spot is the exact number Kalshi will settle on.
- Options data source. We read the SLV (iShares Silver Trust ETF) option chain that expires closest to the Kalshi event close. SLV tracks XAG/USD with a known ETF-to-spot ratio, so call probabilities map cleanly to Kalshi strike levels.
- IV recovery. Yahoo's
impliedVolatilityfield returns quantized garbage; we ignore it. We back-solve implied volatility from the option's last traded price using Brent's method on the Black-Scholes inverse, with a smile filter (strike within ±25% of spot) and an IV clamp of [0.10, 1.50] annualized. - Probability calculation. The risk-neutral probability that spot finishes above strike K is
N(d2)from the Black-Scholes formula, whered2 = (ln(S/K) + (r − σ²/2)·τ) / (σ·√τ). We use the 4-week T-bill yield for r and τ in years until Kalshi event close. - Edge calculation. The signed edge is
options_prob − kalshi_yes_price. Positive = YES is underpriced relative to options. Negative = NO is underpriced. Magnitude is reported in percentage points (pp). - Confidence tiers. HIGH— edge ≥ 10pp, strike within ±5% of spot, option bid-ask spread < $0.05, Kalshi 24h volume ≥ 100 contracts.MEDIUM — edge ≥ 8pp; one liquidity guard fails (volume, spread, or distance from spot).LOW — edge between 5pp and 8pp, or wide spreads on both legs.PASS / SKIP — edge below 5pp, or missing IV (Brent failed to converge inside the smile band).
- Caveats. The risk-neutral probability already prices the market's view of risk; for tail strikes a known risk-premium gap can persist (the rationale field flags it as MEDIUM or LOW with a note). The SLV-vs-XAG/USD tracking error is bounded but non-zero. Use the tool as a screen — the Kalshi link on each row goes to the live order book.
- Last data refresh. Snapshot taken 47 minutes ago (Pyth XAG/USD = $73.63, next refresh in ~23.2h). Pipeline runs daily at 6 AM ET via GitHub Actions.
Position sizing: cap any single Silver Edge play at 2% of trading account, and cap stacked correlated strikes (same direction, adjacent strikes) at 5% combined. Trade responsibly.
Looking for a plain-English silver outlook? See this week's Silver Price Prediction.
Related Tools
Why Options and Kalshi Disagree on Silver
Silver is one of the cleanest commodity prediction-market arbitrage candidates in the US market. Kalshi's weekly silver event settles deterministically on Pyth Network's XAG/USD price feed — there is no question what number the market lands on. SLV options on the iShares Silver Trust ETF track the same underlying. Two different markets, two different microstructures, one underlying number.
The price discovery channels are different. Kalshi's weekly silver flow is dominated by retail traders sizing in 1–10 contract clips. SLV options are priced by professional options market makers running risk-neutral hedging books. When retail flow puts a Kalshi strike at 30¢ and the options book is implying 45% on the same outcome, the gross gap is 15pp. Round-trip trading cost on Kalshi (bid-ask + fees) runs about 5pp on liquid contracts, which leaves roughly +10pp of expected-value edge after slippage. That is not noise — it is two markets on the same underlying that have not agreed on the same number yet.
The Edge in pp
The Silver Edge tool reports gaps in percentage points (pp). A +20pp edge on a BUY YES means the options market is pricing the YES outcome 20 percentage points higher than the Kalshi YES contract. The Kalshi contract pays out $1 if the event happens — pricing it below the options-implied probability is a direct expected-value edge.
Confidence tiers gate the rows by liquidity, not just by edge size. A 60pp edge on a strike with zero 24h volume is not actionable. We require ≥100 contracts of recent volume, a tight bid-ask, and a strike within ±5% of spot for the HIGH tier. Outside those guards, the rationale field flags the specific reason the row dropped to MEDIUM or LOW.
The Hedge
The Robinhood link on each row goes to the SLV option position that mirrors the Kalshi contract. Entering both legs neutralizes most of the directional risk and turns the trade into a pure mispricing capture. Sizing is 2% of trading account per Kalshi leg, 5% combined across correlated strikes — the methodology block below has the exact thresholds and caveats.
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