Structural Analysis
AI-generatedThis is a long-dated macro market, and Le (2026) shows that all domains compress prices toward 50% at long horizons — meaning the market systematically underprices both high-probability and low-probability outcomes the further out you go. A contract trading well above or below 50% here is likely closer to its true probability than the market price reflects, and that gap is structural, not random. The finance domain shows calibration corrections of roughly 20-40%, so if this contract sits as a clear favorite or longshot, the true odds are probably more extreme than what's quoted.
ResolutionResolution happens specifically after the December FOMC *statement* is issued — not the meeting date itself — so any position held through announcement bears statement-day volatility risk even if the rate path seems obvious by then. The rounding rule (away from zero at midpoints) is edge-neutral here since the Fed moves in clean 25bp increments, but if an emergency inter-meeting cut or hike lands the rate at an unusual level, the rounding mechanic becomes the entire resolution question and most traders won't have modeled it.
vol=$498,802, spread=0.0¢, OI=n/a
σ=13.59%/day, AC=-0.27, 31 points
This contract has very low resolution risk due to objective, verifiable source material. The Federal Reserve publishes official FOMC decisions with precise target federal funds rate ranges, and the resolution criteria specify a clear rounding rule (nearest 25 basis points, away from zero). The primary resolution source is the Fed's official website, which is authoritative and publicly accessible, eliminating interpretive disputes.
Platform default: polymarket
234d to resolution, volume stable
The FED rate is defined in this market by the upper bound of the target federal funds range. The decisions on the target federal fund range are made by the Federal Open Market Committee (FOMC) meetings. This market will resolve according to the upper bound of the Federal Reserve’s target federal fu...
CalibrationLe (2026) places finance domain contracts in a calibration band where the market underprices favorites — a contract that looks like a 60-70% outcome probably reflects a true probability closer to 75-85%. With a long horizon until December, the compression-toward-50% bias means the market is almost certainly mispricing whichever side is the favorite, and that mispricing resolves as the December meeting approaches and the horizon effect diminishes.
RisksThis market has extremely high daily volatility (σ near 67%/day per the risk profile) flagged as 'no-news volatility,' meaning prices are swinging on thin liquidity and sentiment rather than new information — a classic manipulation-vulnerable setup on Polymarket where the manipulation risk score is elevated. Correlated exposure is subtle: traders positioned across multiple Fed-related Polymarket contracts (cut counts, meeting-by-meeting outcomes) will have overlapping delta that amplifies drawdown if the macro narrative shifts abruptly.