Felix Salmon (from the RGE Monitor):
The really irrational thing would seem to be why we still place so much faith in opinion polls. Opinion opinion polls would be much more accurate.
Prediction Market Forum:
Global Imbalances – (Start of the Thread = “-DISCUSSION”-) — NewsFutures and RGE Monitor
…- Psstt…- TradeSports traders…- Wanna be rich?…- Do like David Pennock: Get a PhD…- with a major in probabilities…-
Although TradeSports’s individual state predictions and overall Senate prediction were entirely consistent, one might argue that traders underestimated the degree of dependence (correlation) among states’ elections. In fact, I made a few bucks selling the “GOP Senate control” contract on TradeSports using exactly that reasoning. The truth is, I probably just got lucky, and it’s nearly impossible to say whether TradeSports underestimated or overestimated much of anything based on a single election. Such is part of the difficulty of evaluating probabilistic forecasts.