Prediction Markets

Best

The Best Resources On Prediction Markets

Contents

The Best Charts Of Prediction Markets The Best Explainers On Prediction Markets The Best Exchanges Organizing Prediction Markets The Best Software Packages For Prediction Markets The Best Internet Sites On Prediction Markets The Best Experts On Prediction Markets The Best Midas Oracle Posts On Prediction Markets

1. The Best Charts Of Prediction Markets

2008 US Presidential Elections

More Charts:

- Probabilistic Predictions = Charts Of Current Prediction Markets

- Charts Of Expired Prediction Markets

- Other Charts Of Expired Prediction Markets

2. The Best Explainers On Prediction Markets

A prediction market is a market for a contract that yields payments based on the outcome of a partially uncertain future event, such as an election. A contract pays $100 only if candidate X wins the election, and $0 otherwise. When the market price of an X contract is $60, the prediction market believes that candidate X has a 60% chance of winning the election. The price of this event derivative represents the imputed perceived likelihood of the partially uncertain event (i.e., its aggregated expected probability). A 60% probability means that, in a series of events each with a 60% probability, the favored outcome is expected to occur 60 times out of 100, and the unfavored outcome is expected to occur 40 times out of 100.

Each prediction exchange organizes its own set of real-money and/or play-money markets, using either a CDA or a MSR mechanism —with or without an automated market maker.

Prediction markets enable us to attain collective intelligence. Prediction markets produce dynamic, objective probabilistic predictions on the outcomes of future events by aggregating disparate pieces of information that the traders bring when they agree on prices. The event derivative traders are informed by the primary indicators (i.e., the primary sources of information), like the polls, for instance. These informed speculators then execute their transactions based on their anticipations about the future —anticipations that will be either confirmed or infirmed.

The value of a set of prediction markets consists in the added accuracy that these prediction markets provide relative to the other forecasting mechanisms, times the value of accuracy in improved decisions, minus the cost of maintaining these prediction markets, relative to the cost of the other forecasting mechanisms. According to Robin Hanson, a highly accurate prediction market has little value if some other forecasting mechanism(s) can provide similar accuracy at a lower cost, or if very few substantial decisions are influenced by accurate forecasts on its topic.

- The Midas Oracle Explainer On Prediction Markets + The Probabilistic Predictions Generated By The Prediction Markets

- The Full List Of The Midas Oracle Explainers On Prediction Markets

- All The Midas Oracle Explainers On Prediction Markets

3. The Best Exchanges Organizing Prediction Markets

Prediction Exchanges (a.k.a. Event Derivative Exchanges, Bet Exchanges, Betting Exchanges)

#1. Real-Money Prediction Exchanges

- InTrade - (CDA)

- TradeSports - (CDA)

- HedgeStreet - (CDA)

- Iowa Electronic Markets - (CDA)

- Bet 2 Give - (CDA)

- UBC - Election Stock Market - (CDA)

- TradeFair - (CDA)

- MatchBook - (CDA)

- BetFair - (CDA)

- Betdaq - (CDA)

- WBX - (CDA)

- SpreadFair - (CDA)

- iPredict New Zealand - (CDA + MSR + AMM)

- JusTrade - (CDA)

- Red Monitor - (???)

Other Real-Money Websites

- Smarkets - (CDA)

- YooNew

#2. Play-Money Prediction Exchanges

- HudDub - (MSR + AMM)

- NewsFutures - (CDA)

- Inkling Markets - CNN Political Market - (MSR + AMM)

- Foresight Exchange - (CDA)

- Reality Markets - (CDA + AMM)

- Cenimar - (CDA)

- Global Election Market - (CDA)

- Ask Markets - (MSR + AMM)

- Pop Sci Prediction Exchange - (CDA + AMM)

- The Sim Exchange - (CDA + AMM)

- Media Predict - (MSR + AMM)

- Gexid - (???)

- InTrade .NET - InTrade (play money) - WSJ Political Market - FT Predict - (CDA + AMM)

- TradeSports (play money) - (CDA + AMM)

- BetFair (play money) - (CDA)

- Hollywood Stock Exchange - (Virtual Specialist + AMM)

- YooPick - (a FaceBook application) - (MSR + AMM)

- Win Futures - (a FaceBook application) - (? + AMM)

Other Play-Money Websites

- ProTrade - (??? + AMM)

- Sports Derivative Exchange - (CDA)

- Turing Trade

- Celebdaq - Sportdaq

- eLab eXchange - (SR)

- Yahoo!’s Yootopia

#3. More Info

- CDA = Continuous Double Auction

- MSR = Market Scoring Rules

- DPMM = Dynamic Pari-Mutuel Market

- SR = Scoring Rules

- AMM = Automated Market Maker

- List of the main real-money and play-money prediction exchanges (betting exchanges) at Midas Oracle

- Complete list of the real-money and play-money prediction exchanges (betting exchanges) at Midas Oracle

- Complete list of the real-money and play-money prediction exchanges at CFM

4. The Best Software For Prediction Markets

Software For Prediction Markets

- Inkling Markets - (MSR + AMM)

- NewsFutures - (CDA + optional AMM + SR)

- Consensus Point - (CDA + MSR + AMM)

- Xpree - (MSR + AMM)

- Zocalo - (CDA + MSR + AMM) - (open-source)

- Nosco - (CDA + MSR + AMM)

- QMarkets - (MSR + AMM)

- Ask Markets - (MSR + AMM)

- Exago Markets - (CDA + optional AMM)

- Gexid - (?)

- ProKons - (?)

- Spigit - (?)

- TradEvents - (?)

- HSX Virtual Markets - (Virtual Specialist + AMM)

- HubDub - (MSR + AMM) - (not licensed)

- Yahoo!’s Prediction Exchange - (MSR + AMM + DPMM) - (not licensed)

- Google’s Prediction Exchange - (CDA) - (not licensed)

- MicroSoft PredictionPoint - (MSR + AMM) - (not licensed)

- InTrade - (CDA + AMM for play money) - (not licensed)

- TradeSports - (CDA + AMM for play money) - (not licensed)

- Iowa Electronic Markets - (CDA) - (not licensed)

- HedgeStreet - (CDA) - (not licensed)

- TradeFair - (CDA) - (not licensed)

- BetFair - (CDA) - (not licensed)

- Trading Technologies International - (CDA) - (not for event derivatives)

- List of the software packages for prediction markets at Midas Oracle

- Complete list of the software packages for prediction markets at CFM

- Complete list of the prediction markets consultants at CFM

5. The Best Internet Sites On Prediction Markets

Wikis On Prediction Markets

- Wikipedia - Prediction Markets

Books On Prediction Markets

- Predictocracy: Market Mechanisms For Public And Private Decisionmaking - by Michael Abramowicz - 2008

- Winning On Betfair For Dummies - by Alex Gowar and Jack Houghton - 2006

- Information Markets - A New Way Of Making Decisions - (PDF file) - edited by AEI-Brookings’ Bob Hahn and Paul Tetlock - 2006

- The Wisdom Of Crowds - Why The Many Are Smarter Than The Few And How Collective Wisdom Shapes Business, Economies, Societies and Nations - by James Surowiecki - 2004

Research On Prediction Markets

- Prediction Markets: Wisdom Of The Crowd Comes To The Enterprise. - (MO mirror soon) - by Forrester - 2008-07-14

- Private Prediction Markets and the Law - (PDF file) - (MO excerpts) - by Tom W. Bell - 2008-05-18

- Using Prediction Markets to Track Information Flows: Evidence from Google - (PDF file - PDF file) - (MO excerpts) - by Bo Cowgill, Justin Wolfers, and Eric Zitwewitz - 2008-01-06

- Using Forecasting Markets to Manage Demand Risk - by Intel Corporationâ€™s Jay W. Hopman - 2007-05-16

- Prediction Markets - (PDF file) - by Eric Zitzewitz and Justin Wolfers - 2005

- More academic papers and scientific articles will be listed here, in the near future.

- Prediction Market Science - (at MO)

- Complete list of academic papers on prediction markets at CFM

- The Journal of Prediction Markets - (JPM)

Conferences On Prediction Markets

- Third Workshop on Prediction Markets @ Chicago, Illinois, U.S.A. - 2008-07-09

- Conference on corporate applications of prediction markets - by Koleman Strumpf - 2007-11-01

- Second workshop on prediction markets - 2007-06-12

- Confab Yahoo! on prediction markets - Streaming Video: 100k - 300k - 2006-12-13

News Articles And Opinion Pieces On Prediction Markets

- How Companies Are Using IT To Spot Innovative Ideas - by Information Week’s David Greenfield - 2008-11-10

- A century ago, Wall Street treated elections like they were pork bellies â€”and newspaper went along. - by Slate’s Jack Shafer - 2008-09-26

- What’s Holding Back Enterprise Prediction Markets? - by Future Blogger’s Alvis Brigis - 2008-09-15

- How do InTrade’s prediction markets work, and are they really accurate? - by CNBC - 2008-08-25

- Regulation Looms for Prediction Markets. - The Commodity Futures Trading Commission is likely to become involved in regulating event futuresâ€”and it just may boost these markets. - by BusinessWeek’s Ricky McRoskey - 2008-07-07

- Software taps into the zeitgeist to predict the future. - by CIO New’s Linda Tucci - 2008-05-27

- Prediction Market prices can point to a sure thing. - by Financial Times’ John Authers - 2008-05-17

- BetFair Puts Focus on the Fix in Sports Bets. - by New York Times’ Joe Drape - 2008-05-15

- Prediction Markets: Co-Creating An Organization’s Future - (PDF file) - by Inside Knowledge Magazine’s Victoria Axelrod and Jenny Ambrozek - 2008-05-10

- Foretelling The Future: Online Prediction Markets - (video) - by ABC 20/20’s John Stossel and Maxim Lott - 2008-05-09

- The social utility of the event derivative markets - by professor Vernon Smith - 2008-05-01

- Betting to Improve the Odds - by New York Times’ Steve Lohr - 2008-04-09

- New Understandings in Sports Betting - (PDF file) - by BetFair’s Mark Davies - 2008-04-04

- The Promise Of Prediction Markets - by McKinsey - 2008-04-XX

- Prediction market platform taps the wisdom of employees, partners, customers - by Manufacturing Business Technology’s Karen Dilger - 2008-03-01

- When Markets Beat The Polls - (PDF file) - by Scientific American Magazine’s Gary Stix - 2008-03-XX

- Best Bet for Next President: Prediction Markets - Prediction markets can cut through the clutter of polls and pundits. - by Justin Wolfers in the Wall Street Journal - 2007-12-31

- Mob wisdom means business - So-called ‘crowdsourcing’ lets companies create massive focus groups, garner fresh ideas, and even predict the future. - by InfoWorld’s Lena West - 2007-12-10

- YouBet - The wonders and dangers of online sports wagering. - (page 2) - [BetFair explained to the Americans] - by Slate’s T.D. Thornton - 2007-11-28

- The future of futurology = The prediction markets - by The Economist - 2007-11-xx

- Double or Nothing on the Democrat - [The history of prediction markets] - by The New York Times’ J. David Goodman - 2007-11-04

- Before it’s too late - [enterprise prediction markets] - by Adam Siegel (Inkling Markets CEO) for Forbes - 2007-11-02

- Crowdsourcing The Crystal Ball - by Forbes’s James Surowiecki - 2007-10-15

- Bet on It! - (page two - page three) - by Spectrum’s Steven Cherry - 2007-09-01

- Ask The Market - Companies are leading the way in the use of prediction markets. The public sector may soon follow. - (PDF) - by Region Focus’ Vanessa Sumo - 2007-07-20

- The Science of Success - The New Yorker’s James Surowiecki - 2007-07-09

- When enough people take a stake in the future, it’s like a crystal ball. - Page two. - Republished. - by The Associated Press’ Matt Crenson - 2007-06-23

- The Science Behind PPX - Whatâ€™s the most accurate way to forecast the future? Simple: make predictions profitableâ€”just like on the PopSci Predictions Exchange. - by Popular Science magazine’s Michael Moyer - 2007-06-15

- Tech lessons learned from the wisdom of crowds - CNET News’s Declan McCullagh - 2006-12-14

- The Election Investors - Political bettors were in force on trading sites, wagering on red or blue. - [WSJ $$$] - by Wall Street Journal’s E.S. Browning - 2006-11-09

- Why Gambling at the Office Pays. - Prediction markets that let workers place bets on business events help HP, GE and other companies make smarter moves. - by Business 2’s Erick Schonfeld - 2006-10-02

- CEO Guide to Technology - Workers, Place Your Bets - More corporations are setting up their own markets for economic forecasts, hoping to tap into the wisdom of employees. - by BusinessWeek’s Rachael King - 2006-08-03

- Business Solutions - How to Decide? Create a Market. - by Wall Street Journal’s Michael Totty - 2006-06-19

- The Future Divined by the Crowd - page two - (mirror) - by The New York Times’ Joe Nocera - 2006-03-11

- Capital Markets - Betting the Ranch on Your Company - While ”prediction markets” offer a venue to wager on the rise of a politician or the fall of a business executive, they might also provide a basis for useful corporate decision-making. - by CFO magazine’s Helen Shaw - 2006-03-06

- Can markets be used to help people make nonmarket decisions? - by Hal Varian - 2003-05-08

Petitions On Prediction Markets