Insurrection Act invocation cross-venue gap: L5 at 24c vs L6 at 41c
L5 and L6 both cover Trump invoking the Insurrection Act but show a 17-cent cross-venue gap (24c vs 41c) — well above the 5c arb threshold. L5 offers 734% IY vs L6 at just 58% IY, confirming L5 is the mispriced leg. Buy L5 at 24c as the underpriced side; the regime shift environment (L3 Taft-Hartley at 27c, oil/gas surging, VIX elevated) provides fundamental support for executive action risk being underpriced at 24c. The 17c gap is the primary edge; the macro backdrop is confirmation.
The 2026 midterm election markets are undergoing regime shifts with Byron Donalds dominating the Florida GOP primary, Michigan Senate heating up, and House control leaning Democratic — all creating exploitable pricing gaps between legislative power markets and their downstream effects. L1 (Congress overrides Trump veto before 2027) at 10c with 2087% IY and L5 (Insurrection Act invocation) at 24c with 734% IY are the highest-yield policy plays, both pricing extremely low probabilities that thesis edges suggest are underweighted given the current political environment.
CatalystAny major domestic unrest event, labor action, or border crisis triggering executive action
RiskLegal constraints and political cost prevent invocation; gap closes at L5 drifting up rather than L6 down
WatchL5 and L6 converge; L5 resolves YES · by 2026-12-31
sf ideas && sf book KXINSURRECTION-29-27