Methodology

Outlier Weekly finds mispriced rare-event opportunities on Polymarket and Kalshi using a synthesized three-formula system. This page explains the system in plain language. The actual math is in the letters.

Rare-event markets, in one paragraph

Polymarket and Kalshi list event contracts: you buy or sell a contract that pays out when a stated event resolves. A market on "Will X happen by date Y" has a price that the crowd treats as a probability. The crowd is often right about the base rate and wrong about the tail — the rare event, the warehouse failure, the airspace decision nobody priced. That gap between the market's number and a formula's number is what the letter hunts for.

What the system does

Rare-event markets price the probability of a specific future outcome: an airspace decision, a warehouse outcome, a tournament result. Most participants buy or sell on narrative. The Outlier Weekly system instead runs each market through three formulas and lets the numbers disagree with the crowd before any position is taken.

The three formulas are synthesized into one system: the output of all three, taken together, produces a single decision per issue. That decision is either one position or a clear pass. The discipline — one market, three formulas, one position — is the whole point. The letters do not trade dozens of markets; they show the work on one.

How an issue is built

• Pick one rare-event market with a defined resolution date.
• Apply the three formulas to the market's actual numbers and contract prices.
• Write up the disagreement between formula output and market price.
• End with one position — or state why the pass is the correct call.

Why the letters matter more than this page

This page describes the system at one altitude. The letters are the system's actual record: each one names the market, shows the numbers, and dates the reasoning. The framework has evolved in public — Issue 1, then Issue 2, then the standalone methodology letter. If this page and a letter ever disagree, the letter wins. That is why the links below are the real documentation, and why this page deliberately stays shallow.

Where the math lives

The formulas are described, with their actual numbers, in the letters. This page intentionally does not restate the formula math — the letters are the canonical, dated record, and the framework has evolved through them. Read them in order:

• Methodology — the standalone walkthrough of the system.
• Issue 1 — One Market, Three Formulas, One Position (May 2026) — the first full application of the system.
• Issue 2 — Iran Airspace, Three Formulas (May 2026) — the system applied to a geopolitical event market.

What the system is not