The midterms may be over a year away, but there are already high-profile races to watch and trade this fall.
Races for New York City mayor, New Jersey governor, and Virginia governor — all of which will be determined this November — will help set the tone for how the 2026 campaigns will be run. There may be new issues on the table by next year, but the results of these races could move other midterm markets in the immediate aftermath.
Kalshi offers markets on these early races, so it’s also the first shot election traders have to bet on U.S. elections since the presidential election last year.
NYC mayoral race: Mamdani stretches lead
Democratic Socialist Zohran Mamdani’s lead in the NYC mayoral race remains unbroken. He has an 83% chance of winning compared to Andrew Cuomo’s 15%. Adams is barely holding on at 1% and has a 70% chance of dropping out of the race altogether. Neither Independent candidacy has put a dent in Mamdani’s lead.
Mamdani also secured NY Gov. Kathy Hochul’s endorsement on Monday, a high-profile win that signals the Democratic Party’s acceptance of Mamdani, even if it’s reluctant by some members. However, Republicans have taken notice and are using Mamdani’s most left-wing policies against Democrats in other races, including both 2025 gubernatorial races.
NJ gubernatorial race: Republicans face uphill battle
The Democratic candidate has been the favorite to win New Jersey’s gubernatorial race since Kalshi’s market opened. Democrat Mikie Sherrill is facing off against Republican Jack Ciattarelli to capture the governor’s mansion.
A Republican polling firm found Sherrill two points ahead of Ciattarelli last week. Prediction markets are more bullish on Sherrill’s victory than this particular poll, but early polls showed Sherrill ahead by as much as nine points.
Ciattarelli released an ad after Mamdani’s primary victory showing Sherrill saying she would back him if he became the Democratic mayoral nominee. Even though New York City is across the river from New Jersey, Mamdani is a useful club for Republicans to attack Democratic opponents with in other races.
Coming on the heels of a two-term Democratic governor, a Democratic victory could signal a challenging midterm season for Republicans in 2026. That’s especially true if voters blame President Trump for poor economic conditions instead of Democratic incumbents across the United States.
However, Republican odds could rise even if Ciattarelli doesn’t ultimately win. A moment of strength in the campaign would give traders enough time to flip Republican contracts that make even modest returns.
VA gubernatorial race: Democrats set to flip governorship
Virginia’s current governor is Republican Glenn Youngkin, who is prohibited from serving consecutive gubernatorial terms. Youngkin’s successor is likely to be Democrat Abigail Spanberger. She has a 94% chance of winning compared to her challenger, Republican Winsome Earle-Sears, who has a 7% chance of victory.
Virginia has elected two Republicans and two Democrats in the last four gubernatorial elections. This is a chance for Democrats to flip a gubernatorial seat, so the stakes are extra high. It’s also an early test of whether Democratic messaging on economic issues can overcome Trump’s claims about his help to the economy as early signs of a recession loom.
Earle-Sears mentioned Mamdani’s primary victory in a rally over the summer, seeing it as a useful way to tie her Democratic opponent to Mamdani and socialism. The Republican candidate has also warned that Spanberger will overtax Virginians if elected.
That kind of rhetoric hasn’t increased Republican chances of victory in this market. But as the election approaches, Republican odds could increase enough for profitable trades near the end of the campaign.
