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This was a bit of nonsense from Silver. "A truly sophisticated trader, for instance, could make bets in the actual stock market, buying up certain stocks in in
by joonix 14y ago
This was a bit of nonsense from Silver.
"A truly sophisticated trader, for instance, could make bets in the actual stock market, buying up certain stocks in industries that might be expected to perform well under a Romney presidency (for instance, those of oil or coal companies) while shorting those that would probably benefit from Mr. Obama’s remaining in office (for example, certain health care stocks or green-technology companies). "
Come on. Gambling $18k for an instant 100% return in a couple of weeks should be disavowed in favor of these vague stocks that are guaranteed to react to a Romney win? And how long will it take for them to move?
- cs702 14y agojoonix: you're quoting out of context, and you're a brand new user... that's interesting. As Silver explained right above the sentence you quote, a sophisticated trader could have easily arbitraged the spread by buying Betfair's Romney contract at $0.37 per dollar, while simultaneously shorting Intrade's Romney contract at $0.45 per dollar -- a sure thing! Silver then added that $18K "...is a large bet in everyday terms, but not by the standards of a professional gambler or investor who felt he had a sure thing." A truly sophisticated investor seeking to make millions instead of merely thousands, he explained, would look to larger, more liquid markets -- like the stock market. Please don't quote out of context again.