Glossary › Collateral
Checked September 25, 2026 · 3 sources · plain-English definition, not financial advice
Collateral: The cash set aside to cover the most a Kalshi position can lose; event contracts are fully collateralized, so you pay the full cost up front.
Kalshi's rulebook says trader positions in fully collateralized contracts are fully cash collateralized, and no member can take positions whose exposure exceeds the funds deposited. Before a trade executes, Kalshi checks that you have enough to cover your maximum loss and moves that amount out of your available balance. For a simple purchase that maximum loss is what you paid: 100 Yes at 40¢ ties up $40.
Kalshi's optional collateral return feature can free cash early on hedged positions in mutually exclusive or directional market groups. In its example you buy No on two of three candidates for one office at 60¢ and 70¢, $1.30 in total; at least one of those positions must pay $1, so the most you can lose is $0.30, and Kalshi takes only $0.30 of your funds.
What to check: collateral return is off by default for new users, is locked per event from your first order in it, and may stop you from selling positions whose collateral was returned. Deposits are held at the clearinghouse, Kalshi Klear, under its rules.
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Checked September 25, 2026. Kalshi changes fees, rules, funding options and limits; the market's rules, the order ticket and Kalshi's help center are the final word.
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