DraftKings Predictions Fees & Cost Structure 2026
Updated February 26, 2026
Updated February 26, 2026
DraftKings Predictions primarily monetizes trading activity through bid-ask spreads and execution pricing rather than fixed commissions. Effective trading friction typically ranges between 1–4% per round trip under normal liquidity conditions but can exceed 5% during volatility spikes. Costs scale non-linearly with order size due to shallow mid-book depth. Traders using limit orders during peak liquidity windows experience materially lower effective fees.
Unlike traditional exchanges that publish explicit maker and taker commissions, DraftKings Predictions embeds costs directly into market pricing mechanics.
Traders pay through:
This structure means trading cost is variable, not fixed.
The correct question is not “What is the fee?” but:
“How far from fair probability did execution occur?”
Every prediction contract has two prices:
The difference between them represents economic friction.
Price Type | Contract Value |
|---|---|
Bid | $0.52 |
Ask | $0.58 |
Spread | $0.06 |
The theoretical midpoint probability equals $0.55.
A trader buying at market immediately pays a 3% pricing disadvantage relative to midpoint value.
This spread compensates liquidity providers and reflects uncertainty, volatility expectations, and trader imbalance.
Even without published commissions, execution behavior mirrors exchange fee structures.
Execution Style | Effective Fee Equivalent |
|---|---|
Passive limit order (maker behavior) | ~0.5–1.2% |
Small market order | ~2–3% |
Aggressive order during volatility | 4–6%+ |
Market orders function similarly to taker trades by crossing the spread and absorbing available liquidity.
Component | Cost |
|---|---|
Entry spread impact | $1.40 |
Exit spread impact | $1.60 |
Total friction | ~$3 (3%) |
Smaller trades experience proportionally higher costs because spreads represent a fixed percentage range.
Component | Cost |
|---|---|
Entry slippage | $14 |
Exit slippage | $18 |
Total effective cost | ~$32 (3.2%) |
Mid-book liquidity improves efficiency but does not eliminate spread costs.
Observed execution characteristics:
Estimated total friction: 4–6% equivalent.
Large traders must stage orders to control cost.
Trading friction changes dramatically depending on when trades occur.
Timing Window | Typical Cost Behavior |
|---|---|
24+ hours before event | Wider spreads, lower liquidity |
1–3 hours before event | Tightest spreads |
Minutes before start | Liquidity spike but rapid repricing |
Immediately after start | Depth collapses |
Peak efficiency typically occurs shortly before event lock-in when participation is highest.
Prediction market spreads apply regardless of outcome.
Example:
Even with directional accuracy, expected value may become negative if execution costs exceed statistical edge.
This makes execution discipline as important as forecasting accuracy.
Breaking information widens spreads instantly as liquidity providers reduce exposure.
Crowded sentiment produces one-sided books, increasing entry cost.
Automated participants often update prices faster than manual traders.
Platform testing observed:
Processing speed matters more operationally than explicit withdrawal pricing.
Platform | Explicit Fees | Hidden Costs | Net Trading Friction |
|---|---|---|---|
DraftKings Predictions | None listed | Spread + slippage | Medium |
Kalshi | Low commissions | Minimal spread | Low |
Polymarket | Trading fees | Gas + spread | Variable |
PredictIt | Profit deduction | Settlement fee | High on winners |
Cost does not increase linearly.
Key observation:
Beyond roughly mid-book depth, each additional dollar increases marginal execution cost.
Testing suggests traders reduce effective cost by:
DraftKings Predictions does not appear expensive on the surface because commissions are hidden. However, real trading friction remains meaningful and highly dependent on execution quality.
Understanding spread mechanics is essential for maintaining positive expected value.