3 ms·

Right, the 5% withdrawal fee only applies when you withdraw, meaning you could still make a profit continuously buying 95%+ markets. The real reasons I think t

Right, the 5% withdrawal fee only applies when you withdraw, meaning you could still make a profit continuously buying 95%+ markets. The real reasons I think these often don’t follow what you expect is: - Lots of people set sell orders at 90-99 since closing times are often uncertain and there are other opportunities that at least appear to be more profitable. - As you diverge from 50/50, it gets cheaper and cheaper for crazy people to buy up the other side of a bet. This is not always unprofitable too; they just have to sell it to a greater fool. This is with PredictIt’s $850 limit at least.

function_seven 6y ago
I should add to my comment, a lot of the markets I was looking at (months ago), were based on this election. So once I bought in, the money would be tied up for months. Even when I won, after taking into account the withdrawal fee, it would have been a loss. (EDIT: Assuming I deposited the money for that specific market, and it wasn't already on the platform facing down a future 5% fee) If there are $0.95 markets that resolve in the near future, then yeah, I'd roll my money from one to the next. But now I'm wondering if those are more likely to be correctly-priced. (Because other "investors" are thinking the same thing, right?) So now I'm just picking up nickels in front of a steamroller. I can't remember the exact markets when I saw all these 95 cent shares, but the odds of them failing were far below 1/20. Things like Hillary Clinton wining the Democratic nomination, or California voting for Trump. These are the same markets that, within a month of closing, were at 1Y/99N. So any market that's going to resolve very soon, and is still at 5/95, probably represents closer to a true 1/20 odds, and now it's just regular old gambling :)

3 ms·

Right, the 5% withdrawal fee only applies when you withdraw, meaning you could still make a profit continuously buying 95%+ markets. The real reasons I think t

by matthewbauer 6y ago

function_seven 6y ago
I should add to my comment, a lot of the markets I was looking at (months ago), were based on this election. So once I bought in, the money would be tied up for months. Even when I won, after taking into account the withdrawal fee, it would have been a loss. (EDIT: Assuming I deposited the money for that specific market, and it wasn't already on the platform facing down a future 5% fee) If there are $0.95 markets that resolve in the near future, then yeah, I'd roll my money from one to the next. But now I'm wondering if those are more likely to be correctly-priced. (Because other "investors" are thinking the same thing, right?) So now I'm just picking up nickels in front of a steamroller. I can't remember the exact markets when I saw all these 95 cent shares, but the odds of them failing were far below 1/20. Things like Hillary Clinton wining the Democratic nomination, or California voting for Trump. These are the same markets that, within a month of closing, were at 1Y/99N. So any market that's going to resolve very soon, and is still at 5/95, probably represents closer to a true 1/20 odds, and now it's just regular old gambling :)