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The race between 538 and intrade was basically too close to call. See: http://www.bayesianinvestor.com/blog/index.php/2008/11/06/intrade-versus-fivethirtyeight

The race between 538 and intrade was basically too close to call. See: http://www.bayesianinvestor.com/blog/index.php/2008/11/06/intrade-versus-fivethirtyeight/ http://www.bayesianinvestor.com/blog/index.php/2008/11/06/in... and http://www.portfolio.com/views/blogs/odd-numbers/2008/11/05/and-the-winner-isprediction-markets?tid=true http://www.portfolio.com/views/blogs/odd-numbers/2008/11/05/...

mechanical_fish 18y ago
Wow, that BayesianInvestor link is completely insane. According to the guy's own data, on Oct 1 Intrade predicted a 51% chance of Democratic victory in North Carolina, while FiveThirtyEight predicted a 50% change. In other words, their predictions were identical to within the margin of error. Here's how he characterizes that: Intrade got North Carolina right on that date (just barely) while FiveThirtyEight rated it a toss-up. Uh, yeah. As for the fact that the trading markets are, to within a small margin of error, perfectly reflective of the best possible sources of empirical data (e.g. FiveThirtyEight, as of the night before the election): Yawn. Google "efficient market hypothesis". Or read up on the concept of "equilibrium".
- llimllib 18y ago
  Both I and the author of that blog both know what the EMH is and equilibrium is, and the problem is not as simple as you claim it is. Please don't be condescending. While I agree that he seems to have overvalued the 1% difference in intrade and 538 re:North Carolina, do note that he concludes that 538 was the better election predictor. That one sentence does not make the whole article "completely insane", and I'd like to know what else from the article you thought was insane. Furthermore, your last paragraph is completely and utterly incoherent. For one thing, you claim that a complicated, proprietary, untested, statistical data model, whose data is gathered by a person of unknown sympathies, represented the best available model of the empirical data. (How can you even argue that now, after a single election result?) Then you claim that markets should be efficient in reflecting that data, except that they had quite large differences in some states. Which somehow adds up to "yawn". Color me unimpressed.
  - eru 18y ago
    "by a person of unknown sympathies" That's not quite true. 538 was run by a self-confessed Obama-phile.
davidmathers 18y ago
That portfolio.com link is being misleading by only showing the EV totals. If we assume, as he does, that McCain will win MO that means the betting markets got the right number because they got two states wrong, whereas 538 got the wrong number because Nate only got one state wrong. So which one was actually more accurate? I posted the predictions broken out by state here on HN the night before the election: http://news.ycombinator.com/item?id=353182 http://news.ycombinator.com/item?id=353182
- llimllib 18y ago
  I tend to agree that 538 was better; I shouldn't have editorialized that the race was too close to call. I really just meant to summarize the two articles I'd come across that were on exactly this topic. Thanks for collecting that data.

mechanical_fish 18y ago

Wow, that BayesianInvestor link is completely insane. According to the guy's own data, on Oct 1 Intrade predicted a 51% chance of Democratic victory in North Carolina, while FiveThirtyEight predicted a 50% change. In other words, their predictions were identical to within the margin of error. Here's how he characterizes that: Intrade got North Carolina right on that date (just barely) while FiveThirtyEight rated it a toss-up. Uh, yeah. As for the fact that the trading markets are, to within a small margin of error, perfectly reflective of the best possible sources of empirical data (e.g. FiveThirtyEight, as of the night before the election): Yawn. Google "efficient market hypothesis". Or read up on the concept of "equilibrium".

llimllib 18y ago
Both I and the author of that blog both know what the EMH is and equilibrium is, and the problem is not as simple as you claim it is. Please don't be condescending. While I agree that he seems to have overvalued the 1% difference in intrade and 538 re:North Carolina, do note that he concludes that 538 was the better election predictor. That one sentence does not make the whole article "completely insane", and I'd like to know what else from the article you thought was insane. Furthermore, your last paragraph is completely and utterly incoherent. For one thing, you claim that a complicated, proprietary, untested, statistical data model, whose data is gathered by a person of unknown sympathies, represented the best available model of the empirical data. (How can you even argue that now, after a single election result?) Then you claim that markets should be efficient in reflecting that data, except that they had quite large differences in some states. Which somehow adds up to "yawn". Color me unimpressed.
- eru 18y ago
  "by a person of unknown sympathies" That's not quite true. 538 was run by a self-confessed Obama-phile.

davidmathers 18y ago

That portfolio.com link is being misleading by only showing the EV totals. If we assume, as he does, that McCain will win MO that means the betting markets got the right number because they got two states wrong, whereas 538 got the wrong number because Nate only got one state wrong. So which one was actually more accurate? I posted the predictions broken out by state here on HN the night before the election: http://news.ycombinator.com/item?id=353182 http://news.ycombinator.com/item?id=353182

llimllib 18y ago
I tend to agree that 538 was better; I shouldn't have editorialized that the race was too close to call. I really just meant to summarize the two articles I'd come across that were on exactly this topic. Thanks for collecting that data.