Midas Oracle .ORG » Market Expiry

Republican Scott Brown has become the Senator-elect from Massachusetts.

Chris F. Masse — Wed, 20 Jan 2010 07:39:59 +0000

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Copenhagen Prediction Market

Chris F. Masse — Wed, 06 Jan 2010 11:17:40 +0000

“final payoffs and ranking of ALL markets will take place shortly after 1 February 2010, when the details of the document will have been decided.”

2009 New Jersey Gubernatorial Race: Was Nate Silver’s prediction more accurate than InTrade’s?

Chris F. Masse — Wed, 04 Nov 2009 07:19:49 +0000

Nate Silver’s prediction (November 2, 2009): “I’d make Christie about the 4:3 favorite.”

[ UPDATE: Nate Silver's prediction post-mortem on the 2009 US elections.]

You can see that days before Elections 2009, InTrade was too heavy on Corzine:

Nobel Prize for Economics 2009 — Prediction Accuracy

Chris F. Masse — Mon, 12 Oct 2009 12:58:04 +0000

The Royal Swedish Academy of Sciences has decided to award The Sveriges Riksbank Prize in Economic Sciences in Memory of Alfred Nobel for 2009 to Elinor Ostrom “for her analysis of economic governance, especially the commons” and Oliver E. Williamson “for his analysis of economic governance, especially the boundaries of the firm”.

Both the bookmakers and the prection markets are utterly useless in trying to divine who will get the Nobel prize of economics.

Below is the 2009 prediction post-mortem:

1. Bookmakers

Ladbrokes’s probabilities (odds) for the 2009 Nobel prize in economics:

Eugene Fama 2/1
Paul Romer 4/1
Ernst Fehr 6/1
Kenneth R. French 6/1
William Nordhaus 6/1
Robert Barro 7/1
Matthew J Rabin 8/1
Jean Tirole 9/1
Martin Weitzman 9/1
Chris Pissarides 10/1
Dale T Mortensen 10/1
Xavier Sala-i-Martin 10/1
Avinash Dixit 14/1
Jagdish N. Bhagwati 14/1
Robert Schiller [sic] 14/1
William Baumol 16/1
Martin S. Feldstein 20/1
Christopher Sims 25/1
Lars P. Hansen 25/1
Nancy Stokey 25/1
Peter A Diamond 25/1
Thomas J. Sargent 25/1
Dale Jorgenson 33/1
Paul Milgrom 33/1
Oliver Hart 40/1
Bengt R Holmstrom 50/1
Elhanan Helpman 50/1
Ellinor Ostrom 50/1
Gene M Grossman 50/1
Karl-Goran Maler 50/1
Oliver Williamson 50/1
Robert B Wilson 50/1

2. Betting Pools

Here is the betting in the Nobel pool at Harvard:

Robert Barro -10%
John Taylor – 8%
Paul Milgrom – 8%
Jean Tirole – 6%
Oliver Williamson – 6%
Martin Weitzman – 6%
Eugene Fama – 5%
Richard Thaler – 5%
Lars Hansen – 4%
Paul Romer – 4%

3. Prediction Markets

InTrade:

Previously: Nobel Prize for Economics 2009 Predictions

Professor Thomas Rietz (Iowa Electronic Markets) was so wrong on the usefulness of prediction markets about the 2016 Summer Olympics in Chicago.

Chris F. Masse — Fri, 02 Oct 2009 16:49:15 +0000

Chicago Olympic Market Might Have Value, Says Reitz (Chicago Tribune, April 17)
A credible source of information about Chicago’s chances of hosting the 2016 Olympics would have value, says columnist Bill Barnhart. Local real estate developers, hotel operators, employment agencies, vendors of products and services to major events and others have a direct stake in whether or not an Olympics is staged here. Politicians and civic leaders presumably would want to know whether the city’s bid has a chance, so that they wouldn’t throw good money after bad. An auction market centered on whether Chicago will win could provide that information, even if there were no huge payoff for hedgers or speculators, said finance professor THOMAS RIETZ at the University of Iowa, a board member of the popular Iowa Electronic Markets. The Iowa market limits wagers to $500 but has an enviable track record in picking the winners of national elections. “Our goal is to aggregate information, which is a different goal than being able to hedge the economic risk associated with something like this,” Rietz said. “I don’t think it’s an outlandish idea.”

http://www.chicagotribune.com/business/yourmoney/chi-0704160447apr17,0,2547860.column?coll=chi-business-hed

Prof, you were 100% wrong.

Prediction markets on which country will host the Olympics have never worked.

- BetFair’s event derivative prices (on the far right of the chart, you can see that the price went down to zero):

- InTrade’s event derivative prices (on the far right of the chart, you can see that the price went down to zero):

- HubDub’s event derivative prices:

Who will recieve the winning bid to host the 2016 Olympics?

- Here’s what happened to the Paris 2012 event derivative:

Chicago won’t have the Olympics in 2016.

Chris F. Masse — Fri, 02 Oct 2009 16:11:28 +0000

The Chicago candidacy, which was favored by the prediction markets (and bettors like Ben Shannon), is the one that fared the worst.

I TOLD YOU SO:

- “Will Chicago get the Olympics? Don’t bet on it. Too risky.“

- The prediction markets are not able to forecast which country will get the Olympics. The IOC is a close aristocratic group that does not leak information. Hence, it is not possible to aggregate information.

- Once again, Ben Shannon made a very bad bet. He should read Midas Oracle more often —if he wants to avoid personal bankruptcy.

- Once again, we see that the P.R. agents of InTrade and BetFair (who both bragged about being able to predict Chicago) were overselling.

- BetFair’s event derivative prices (on the far right of the chart, you can see that the price went down to zero):

- InTrade’s event derivative prices (on the far right of the chart, you can see that the price went down to zero):

- HubDub’s event derivative prices:

Who will recieve the winning bid to host the 2016 Olympics?

- Here’s what happened to the Paris 2012 event derivative:

Next: Could we have divined that Chicago was a lemon?

Next: “I have to agree with Chris. The market participants did not possess a sufficient level of information completeness to arrive at the correct prediction.”

In tricky cases, shouldn’t prediction exchanges void all bets and refund all bettors?

Chris F. Masse — Wed, 23 Sep 2009 18:00:47 +0000

BetFair in Prediction Market Settlement Row With Simon Cawkwell

Event derivative trader set to continue with BetFair legal battle

[Simon Cawkwell] stood to lose £6,342 if the market was settled with Quinn getting the job, but would collect £29,983 if it went to another manager. Quinn was appointed, but Cawkwell claimed only on a temporary basis, which he maintains meant he won.

Wikipedia:

[Simon Cawkwell] is also known to trade on the betting exchange Betfair, and prompted a long-running dispute with the firm when his wager that Niall Quinn would not become permanent manager of Sunderland AFC was lost, despite Quinn stating that he was only taking the job temporarily. Fellow Irishman Roy Keane took over the role a few weeks later in August 2006, after Betfair had settled the market.

The Telegraph (in 2007):

An almighty spat has erupted between two of this country’s best known gambling giants: market leading betting exchange Betfair and the 20-stone punter-cum-bear trader Simon “Evil Knievil” Cawkwell. The heavyweight contest revolves around a wager placed by Cawkwell with Betfair last year on the identity of the next manager of Sunderland football club. Cawkwell bet against Niall Quinn, who was then buying the club, only for the Irishman to complete the transaction, become chairman and appoint himself as manager. Still, as soon as he’d done that, Quinn immediately started talking about replacing himself in the dugout with a “world class” gaffer “sooner rather than later” and as Betfair’s rules state that the appointment of a “caretaker, interim or similar” boss doesn’t count, well, you see the problem. Cawkwell reckons he’s £36,000 out of pocket and has called in m’learned friends, while Betfair argues it settled up correctly and points out the case was dismissed by the industry referee. Undeterred, [Simon Cawkwell] has just fired off a letter to Quinn himself.

Truly interesting dispute. Don’t you think that in those very tricky cases, the prediction exchanges should void all bets and refund all parties? Sounds the best way to go, in my humble and modest opinion.

Via BettingMarket.com

Can we really assess InTrade’s very short prediction market on Van Jones?

Chris F. Masse — Mon, 07 Sep 2009 07:13:06 +0000

Carlos Graterol has a partial analysis on the Van Jones prediction market at InTrade. Basically, Carlos Graterol (an InTrade fanboy) says that InTrade should be credited for the accurate prediction.

Carlos Graterol should publish what the politicians and editorialists were saying last week (the resignation calls were numerous);
The InTrade prediction market should have been created much, much earlier —when Glenn Beck started his ‘anti-czars’ guerrilla (at the beginning of August 2009).

Predicting (well in advance) the Van Jones departure –> Epic FAIL

Chris F. Masse — Sun, 06 Sep 2009 07:42:49 +0000

HubDub [*] failed to predict the resignation of Van Jones [more info]:

[*] InTrade has a very young Van Jones contract (230 transactions, only):

UPDATE: Carlos Graterol has a partial analysis. He has not surveyed what the well informed D.C. media was telling on September 5 and September 6. This is important if one wants to assess InTrade’s prediction, relatively to its environment.

Al Franken, US Senator

Chris F. Masse — Wed, 08 Jul 2009 06:47:37 +0000