Comments on: Prediction markets react to polls. http://www.midasoracle.org/2008/12/30/prediction-markets-react-to-polls/ Prediction Markets, etc. Thu, 02 Feb 2012 23:13:18 +0000 hourly 1 http://wordpress.org/?v=3.3.1 By: Chris F. Masse http://www.midasoracle.org/2008/12/30/prediction-markets-react-to-polls/#comment-23554 Chris F. Masse Mon, 02 Mar 2009 00:19:09 +0000 http://www.midasoracle.org/?p=12509#comment-23554 Inkling Markets CEO Adam Siegel speaks out on the current state of enterprise prediction markets. http://www.midasoracle.org/2009/03/01/inkling-markets-ceo-adam-siegel-speaks-out-on-the-current-state-of-enterprise-prediction-markets/ Inkling Markets CEO Adam Siegel speaks out on the current state of enterprise prediction markets.
http://www.midasoracle.org/2009/03/01/inkling-markets-ceo-adam-siegel-speaks-out-on-the-current-state-of-enterprise-prediction-markets/

]]> By: Chris F. Masse http://www.midasoracle.org/2008/12/30/prediction-markets-react-to-polls/#comment-23397 Chris F. Masse Wed, 18 Feb 2009 11:40:53 +0000 http://www.midasoracle.org/?p=12509#comment-23397 The truth about prediction markets http://www.midasoracle.org/2009/02/14/the-truth-about-prediction-markets/ The truth about prediction markets
http://www.midasoracle.org/2009/02/14/the-truth-about-prediction-markets/

]]> By: Are they afraid? | Midas Oracle .ORG http://www.midasoracle.org/2008/12/30/prediction-markets-react-to-polls/#comment-23238 Are they afraid? | Midas Oracle .ORG Thu, 08 Jan 2009 08:02:20 +0000 http://www.midasoracle.org/?p=12509#comment-23238 [...] F. Masse January 8th, 2009 Bo Cowgill and Midas Oracle are the only media to have published about the Lee/Moretti paper. We are awaiting insightful takes [...] [...] F. Masse January 8th, 2009 Bo Cowgill and Midas Oracle are the only media to have published about the Lee/Moretti paper. We are awaiting insightful takes [...]

]]> By: Censorship? | Midas Oracle .ORG http://www.midasoracle.org/2008/12/30/prediction-markets-react-to-polls/#comment-23225 Censorship? | Midas Oracle .ORG Mon, 05 Jan 2009 09:54:27 +0000 http://www.midasoracle.org/?p=12509#comment-23225 [...] F. Masse January 5th, 2009 Midas Oracle is the only media to have published about the Lee/Moretti paper. Is there censorship going on? Here is the listing of the prediction [...] [...] F. Masse January 5th, 2009 Midas Oracle is the only media to have published about the Lee/Moretti paper. Is there censorship going on? Here is the listing of the prediction [...]

]]> By: Jason Ruspini http://www.midasoracle.org/2008/12/30/prediction-markets-react-to-polls/#comment-23220 Jason Ruspini Sat, 03 Jan 2009 16:52:12 +0000 http://www.midasoracle.org/?p=12509#comment-23220 From what I saw in the final two weeks, non-longshot state-level divergences between Intrade and 538 mainly came down to latency in 538 updates. It seemed like the markets interpreted new polls earlier, creating divergences that largely disappeared when 538 was updated hours later. About the paper, the markets may have immediately integrated new poll data as they should, but smoothed/averaged the news with traders' previous outlooks. If you superimpose the charts as above, it will look like the markets are integrating polls with a delay.. or are they instead reflecting polls immediately but discounting them? Replacing the market prices with 538's output on the percentage scale above probably looks the same, as 538 smoothed new polls. New polls are noisy and it's desirable to wait for confirmation before jumping to the conclusion suggested by the latest poll. As the prediction is made to respond more quickly, the risk of head-fakes increases, like we see in the first three poll spikes above. If you have two series with the same mean absolute error, the more volatile series will score worse with squared or log errors. From what I saw in the final two weeks, non-longshot state-level divergences between Intrade and 538 mainly came down to latency in 538 updates. It seemed like the markets interpreted new polls earlier, creating divergences that largely disappeared when 538 was updated hours later.

About the paper, the markets may have immediately integrated new poll data as they should, but smoothed/averaged the news with traders’ previous outlooks. If you superimpose the charts as above, it will look like the markets are integrating polls with a delay.. or are they instead reflecting polls immediately but discounting them? Replacing the market prices with 538′s output on the percentage scale above probably looks the same, as 538 smoothed new polls. New polls are noisy and it’s desirable to wait for confirmation before jumping to the conclusion suggested by the latest poll. As the prediction is made to respond more quickly, the risk of head-fakes increases, like we see in the first three poll spikes above. If you have two series with the same mean absolute error, the more volatile series will score worse with squared or log errors.

]]> By: Chris F. Masse http://www.midasoracle.org/2008/12/30/prediction-markets-react-to-polls/#comment-23214 Chris F. Masse Fri, 02 Jan 2009 22:45:23 +0000 http://www.midasoracle.org/?p=12509#comment-23214 And go fugging yourself with the comparison between the polls and the prediction markets. Enough already with that. You should compare PMs with the mass media. And go fugging yourself with the comparison between the polls and the prediction markets. Enough already with that. You should compare PMs with the mass media.

]]> By: Chris F. Masse http://www.midasoracle.org/2008/12/30/prediction-markets-react-to-polls/#comment-23213 Chris F. Masse Fri, 02 Jan 2009 22:07:09 +0000 http://www.midasoracle.org/?p=12509#comment-23213 Mike, small states with few polls had prediction markets with thin liquidity whose probabilities reflected those polls. I would say that. I didn't investigat that closely, to be honest. Mike, small states with few polls had prediction markets with thin liquidity whose probabilities reflected those polls.
I would say that.
I didn’t investigat that closely, to be honest.

]]> By: Mike Linksvayer http://www.midasoracle.org/2008/12/30/prediction-markets-react-to-polls/#comment-23212 Mike Linksvayer Fri, 02 Jan 2009 20:11:34 +0000 http://www.midasoracle.org/?p=12509#comment-23212 David, so did the markets move when Nate posted?  Should be testable. Chris, what was driving political prediction markets lacking relevant polls? David, so did the markets move when Nate posted?  Should be testable.

Chris, what was driving political prediction markets lacking relevant polls?

]]> By: Chris F. Masse http://www.midasoracle.org/2008/12/30/prediction-markets-react-to-polls/#comment-23210 Chris F. Masse Fri, 02 Jan 2009 17:30:59 +0000 http://www.midasoracle.org/?p=12509#comment-23210 Polls, poll aggregators and poll analysts were driving the political prediction markets. Polls, poll aggregators and poll analysts were driving the political prediction markets.

]]> By: Daniel Horowitz http://www.midasoracle.org/2008/12/30/prediction-markets-react-to-polls/#comment-23207 Daniel Horowitz Fri, 02 Jan 2009 16:58:42 +0000 http://www.midasoracle.org/?p=12509#comment-23207 I believe Nate (fivethirtyeight.com) was driving the prediction markets based on his analysis of the polls. I believe Nate (fivethirtyeight.com) was driving the prediction markets based on his analysis of the polls.

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