3 ms·

The chance of Brexit was hovering around 25% just before the vote; I wouldn't describe that as 'so terrible'.

vegabook 10y ago
as of 10pm in London last night, when one could reasonably expect it to be getting more accurate, it was at 11%. And 25% was in any case a very poor prediction considering these markets are supposed to be more accurate than polls.
- smeyer 10y ago
  >And 25% was in any case a very poor prediction considering these markets are supposed to be more accurate than polls If the markets predicted 75% A vs 25% B and A always turned up, that would make them a poor prediction. Predicting 25% B may mean they're not making much of a prediction (since they're not so far off from 50/50), but it doesn't mean that B being the outcome is indicative of a the prediction being deeply wrong.
  - vegabook 10y ago
    yes I know how sampling works. However as the uncertainty decreased, the prediction markets went in the wrong direction, rapidly on the last day and signficantly in the last week. This strongly suggests that there is an element of "herding" going on by what are supposed to be rational, atomic, individual, actors (the first two of those three assumptions were violated by profit incenctive, and a non-secret ballot, respectively, it seems). Hence I stand by my view that the prediction markets turned out to be terribly poor. You will admit that as final polls all hovered around 50%, if accurate (and they seemingly were), prediction markets should have been wildly swinging between, say 25/75 and 75/25. They were not. They were trending consistenly lower for brexit.
- delazeur 10y ago
  Then we need the polled odds to make this comparison.
- yummyfajitas 10y ago
  This does not imply polls are more or less accurate than prediction markets. The way to measure that is to look at 100 cases where prediction markets predict 75% odds. If approximately 75 of them result in a winner, prediction markets are accurate. Looking at a single data point and declaring a probabilistic predictor to be inaccurate is not even wrong.
  - vegabook 10y ago
    but who is looking only at a single data point? We have more information than that, namely, the strongly consistent incorrect direction of the prediction markets, as the uncertainly decreased (40% to 25% in the last week, and 25% to 11% in the last day). It is clear that there was a feedback loop into the predictors. These markets appeared structurally biased towards the larger odds -> this is where the profit motive is possibly distorting.
syngrog66 10y ago
if yesterday the chance was guessed as 25% and today its 99% thats a big difference. :-) (I wont say its 100% today because I've heard of at least 3 scenarios so far in which Brexit may not truly happen.)

as of 10pm in London last night, when one could reasonably expect it to be getting more accurate, it was at 11%. And 25% was in any case a very poor prediction considering these markets are supposed to be more accurate than polls.

smeyer 10y ago
>And 25% was in any case a very poor prediction considering these markets are supposed to be more accurate than polls If the markets predicted 75% A vs 25% B and A always turned up, that would make them a poor prediction. Predicting 25% B may mean they're not making much of a prediction (since they're not so far off from 50/50), but it doesn't mean that B being the outcome is indicative of a the prediction being deeply wrong.
- vegabook 10y ago
  yes I know how sampling works. However as the uncertainty decreased, the prediction markets went in the wrong direction, rapidly on the last day and signficantly in the last week. This strongly suggests that there is an element of "herding" going on by what are supposed to be rational, atomic, individual, actors (the first two of those three assumptions were violated by profit incenctive, and a non-secret ballot, respectively, it seems). Hence I stand by my view that the prediction markets turned out to be terribly poor. You will admit that as final polls all hovered around 50%, if accurate (and they seemingly were), prediction markets should have been wildly swinging between, say 25/75 and 75/25. They were not. They were trending consistenly lower for brexit.
delazeur 10y ago
Then we need the polled odds to make this comparison.
yummyfajitas 10y ago
This does not imply polls are more or less accurate than prediction markets. The way to measure that is to look at 100 cases where prediction markets predict 75% odds. If approximately 75 of them result in a winner, prediction markets are accurate. Looking at a single data point and declaring a probabilistic predictor to be inaccurate is not even wrong.
- vegabook 10y ago
  but who is looking only at a single data point? We have more information than that, namely, the strongly consistent incorrect direction of the prediction markets, as the uncertainly decreased (40% to 25% in the last week, and 25% to 11% in the last day). It is clear that there was a feedback loop into the predictors. These markets appeared structurally biased towards the larger odds -> this is where the profit motive is possibly distorting.

syngrog66 10y ago

if yesterday the chance was guessed as 25% and today its 99% thats a big difference. :-) (I wont say its 100% today because I've heard of at least 3 scenarios so far in which Brexit may not truly happen.)