Reflecting on Three Months of Stuck PNL

2026-09-29

I relate a lot to the frame of trying to be good at something being in large part the process of amputating everything else from yourself. This isn’t really a choice I’m making, just how I have engaged with everything for the entirety of my conscious life and I am hard-pressed to imagine a different modality of being. I don’t have social connections or hobbies, I just do a single Thing which as of late is trying to make the number go up in my Kalshi account (of course implicit in any specific attempt to make money is that this is your best available avenue for doing so. PMs as a whole certainly are for me but it’s likely that I am underutilizing other exchanges). This is relatively abnormal and probably in some ways defective but it seems to work fine as a way of giving your life meaning. At the end of the day there isn’t really anything to say about competition on a meta level. David Foster Wallace, Ping Pong the Animation, Jiro Dreams of Sushi, One Piece, and other works in the same genre do a great job of packaging the unanswerable philosophical questions around it into entertainment and people who have this type of mental disorder enjoy discussing them with each other but that doesn’t extend beyond self-gratification. Consuming media like that is antithetical to the spirit of competition because you could instead use the time to push harder and the popularity of these works means most of their audience is not trying to compete in any domain. My writing here is similarly pointless, the plausible deniability I have is wanting to clarify my thinking but really my dominant motivation is that I felt a strong aversion to writing this which made me think I should do so.

In any case, retreating somewhat from the meta, I think a lot of my comparative advantage has been willingness to keep pushing the needle but it’s always been clear this environment was not sustainable. Kalshi has done a great job of continuing to attract fish to feed into the grinder and large size significant mispricings are still more common than they should be but looking back a year the game has undoubtedly gotten harder. I’ve upskilled a lot as well to keep up but am certainly now at a point where further improvements on my end will come increasingly slowly while the market will maintain its relentless, ever-accelerating pace. If you took me ten years into the future I’d expect to have no edge, probably that’s also true for five. When I was starting out and was still down overall after having lost a large percentage of my net worth I wrote:

Repeating that exercise now I’d say that over the remainder of 2026 25% return (85%) 50% return (50%) 100% return (25%) <0% return (5%). In 2027 it seems more likely than not that I should still be able to at least 2X but past that point who knows. The Sort comes for us all even if the world were not facing radical change brought on by AI adding a whole new dimension of uncertainty to what the future will look like and what economic value I can continue providing. Not being a serious enough person to make a lot of money or do meaningful safety work despite being early to AI is probably my biggest failing and these days I don’t really see a way to contribute to it going well so I do my best to emotionally tune out the constant stream of new developments. Setting aside existential concerns, my former skill set as a software engineer has been made obsolete and it seems like a given that my two current focuses of forecasting and trading will go the same way in relatively short order.

These are some of the things I kept thinking about over the last few months as my PNL stayed mostly flat through a process of a steady gradual climb and occasional large losses. I was bolstered by the existence of very clear mispricings I could see but also this doesn’t happen to you if you are realizing a significant enough edge. This period largely served as a warning sign that on a long enough timeframe, as edge declines, drawdowns will become more frequent and I hope that when the time comes that I am no longer competitive I will be able to hang up my cleats without losing too much. Of course I made many clear-cut mistakes during this time but those just seem like the cost of having a non exceedingly conservative tolerance for operating in a state of uncertainty. The main action I do hold against myself is devoting too much energy to a specific challenging problem with a nebulous payoff because I was too focused on optimizing for turning money around quickly and I suspect I somewhat Goodharted myself.

This thing I am doing is just very weird and it’s hard to calibrate yourself on what to aim for. None of my connections outside the PM sphere that I have pitched on working on this have done so and it’s not possible to convey to them the experience of what I have done and am doing. Within the PM sphere it’s difficult to have the trust required for meaningful discussion when there is so much money on the line and so much PVP potential (I’m very grateful to the “The Invisible Line” people that I do collaborate with) as far as I know most people are either not taking it as seriously as I do or much better than me which also leads to a hard-to-bridge inferential gap. Objectively speaking my results have been fairly good, based on the public Kalshi and Polymarket leaderboards I am probably in the top 1000 in the world. However I have never found that perspective to be useful and can very clearly see the ways in which I am deficient compared to the top 100. If you’re not a genius you can’t be competitive unless you go extremely hard and I’m taking that as a given, the demanding part is everything else.

Regardless I do still feel a deep appreciation for the intellectual challenge of this game and am highly motivated to continue trying to be the best I can be at it for as long as doing so remains viable.