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Financial markets are generally better indicators of overall sentiment than betting sites but point taken
by ripped_britches 2y ago
Financial markets are generally better indicators of overall sentiment than betting sites but point taken
- csomar 2y agoThe betting site did predict Trump will win the election.
- itake 2y agoThe crypto betting site users had high sentiment trump would win
- FabHK 2y agoIf the betting site is used as a hedge, then the equilibrium prices don’t reflect real-world probabilities. Suppose people predicted that Trump would tank the economy and wanted a few extra dollars in that case. An extra dollar in a Trump world would be worth more than in a normal world, thus distorting betting.
- fulladder 2y agoActually, that's not what I've found. When I have compared betting sites like Kalshi and Polymarket to the implied probability of Fed rate cuts in the interest rate futures market, I have found them to match up and move in lock step with each other. (I don't work for any of these companies and I don't use the betting sites myself; just stating my observation.)
- ProjectArcturis 2y agoThat's because there's an easy arbitrage. If the prices get out of line with each other, anyone can buy the cheap one, sell the expensive one, and get free money.