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Everytime someone loses money on a bad bet in a prediction market, it's an opportunity for them to learn something about ~~counter-party risk~~ adverse selectio
by mathgradthrow 5mo ago
Everytime someone loses money on a bad bet in a prediction market, it's an opportunity for them to learn something about ~~counter-party risk~~ adverse selection. You could easily make the argument that the more people are losing in prediction markets, the more learning is happening.
- tptacek 5mo agoBetting venues can make money on transaction volume rather than holding an edge against their customers on the actual bets.
- jgalt212 5mo agoonly if such venues are Parimutuel.
- pants2 5mo agoCounterparty risk would be more like the betting site going belly-up and not getting money out despite having a profitable trade. This is just regular risk.
- mathgradthrow 5mo agoYou're right, but I was confusing counterparty risk and adverse selection.
- bobro 5mo agoEvery time a drug addict uses, they’re actually learning about biology and the sociology of addiction.