NPD releases April sales data, prediction market and analyst compared

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Last month was the first month the simExchange (the free to play video game stock market game) has traded monthly hybrid futures contracts to predict NPD US video game sales data. In this trial run, trading on the simExchange appeared to be relatively more accurate than expert predictions. To quickly review, the following table depicts actual sales as reported by NPD Group, the prediction by trading on the simExchange, the error of the simExchange&#8217-s forecast, the prediction by leading Wall Street firm Wedbush Morgan, and the error of Wedbush Morgan&#8217-s forecast:

US Hardware March 2007

ConsoleActual Sales*The simExchange**ErrorWedbush Morgan***Error
Nintendo DS508k492.8K-2.99%250K-50.79%
Nintendo Wii259k385.0K+48.65%400K+54.44%
Microsoft Xbox 360199k231.0K+16.08%250K+25.63%
Sony PlayStation Portable180K180.5K+0.28%210K+16.67%
Sony PlayStation 3130k144.0K+10.77%165k+26.92%

NPD has released its findings for US April 2007 video game sales. The following charts compare actual sales numbers determined by the NPD Group with forecasts from market trading on the simExchange and predictions by leading Wall Street analyst Michael Pachter of Wedbush Morgan.

US Hardware April 2007

RankConsoleActual Sales*The simExchange**ErrorWedbush Morgan****Error
1.Nintendo DS471k548.9K+16.54%450K-4.46%
2.Nintendo Wii360k319.5K-11.25%300K-16.67%
3.Sony PlayStation 2194kNot listedN/A250K+29.87%
4.Sony PlayStation Portable183K190.4K+4.04%200K+9.29%
5.Microsoft Xbox 360174k194.8K+11.95%175K+0.57%
6.Nintendo GameBoy Advance84kNot listedN/AN/AN/A
7.Sony PlayStation 382k107.3K+30.85%100k+21.95%
8.Nintendo GameCube13kNot listedN/AN/AN/A

The simExchange did not trade monthly hybrid futures for game software this month. However, NPD&#8217-s Top 10 is still relevant for comparing how trading on the simExchange is forecasting lifetime, global sales of the games.

RankTitlePublisherApril Sales*Lifetime Forecast**
1.Pokemon Diamond (DS)Nintendo1.045M18.21M
2.Pokemon Pearl (DS)Nintendo712K18.21M
3.Super Paper Mario (Wii)Nintendo352K1.83M
4.Wii Play w/remote (Wii)Nintendo249K4.90M
5.Guitar Hero 2 w/ guitar (Xbox 360)Activision197K1.30M
6.Guitar Hero 2 w/ guitar (PS2)Activision142KNot listed
7.Spider-Man 3 (Xbox 360)Activision117K1.07M
8.Spider-Man 3 (PS2)Activision105K1.62M
9.God of War II (PS2)Sony101K1.92M
10.MLB &#8216-07: The Show (PS2)Sony79KNot listed

Although data is still limited, initial predictions on the simExchange video game prediction market appear to be relatively accurate (compared with traditional predictors), and in some cases, absolutely accurate (compared with the actual result). The prediction market out performed the analyst on every prediction in March and was split in April.

Predictions on the simExchange should become more accurate over time as more accurate players are rewarded with more virtual currency for their accuracy (thereby enabling them to form more predictions) and less accurate players lose virtual currency (thereby discounting their ability to form more predictions).

Joining and playing the simExchange is completely free and does not involve any real money. To play, sign up here.

* NPD Group sales data
** The simExchange trading data
*** GameDaily Biz, April 13, 2007
**** GameDaily Biz, May 14, 2007

Cross posted from NPD releases April sales data, prediction market and analyst compared on the simExchange Official Blog.

Previously: Accounting sales of digitally downloaded games, Next lesson: so the “futures” aren’t really future, So what exactly are these “futures?”, The structure of the simExchange stocks and An invitation to join the simExchange beta.

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