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That's exactly what "prediction markets" sell themselves as. Super-predictors. Insiders have an edge and can in theory shape the overall distribution of bets s

by echelon 14d ago

That's exactly what "prediction markets" sell themselves as. Super-predictors. Insiders have an edge and can in theory shape the overall distribution of bets such that the real world outcomes are priced in better.

sd9 14d ago
Yes but in this case, tens or hundreds of people know the outcome months in advance. I'm very surprised that the market doesn't immediately converge to 100% for one candidate. The winner is not really a forecastable 'random event' in that by the time the show is airing, it's not being pulled from a distribution.
- yorwba 13d ago
  In theory, an insider willing to take any positive-expectation bet would drive the market price arbitrary close to the correct answer, but in practice they might be under NDA and want to avoid getting caught, or they limit their bet amount for other reasons, so the market ends up dominated by gamblers placing uninformed bets.
  - sd9 13d ago
    Indeed, I'm just surprised. Maybe the people who could take advantage of these markets are just not sufficiently aware of their existence. I predict that in 5 years "who wins Survivor" will be completely dead though, because the markets will have become common knowledge and there'll be enough people willing to violate their NDAs/whatever for the money.
  - FireBeyond 13d ago
    You say in practice, NDAs. What we've seen so far: classified military ops, people with access to Presidential speeches...
    - yorwba 13d ago
      In none of those cases did the market converge as a result of the insider betting, it was only discovered with hindsight that someone had placed a suspiciously well-timed large bet. So that's where "they limit their bet amount for other reasons" comes in. I guess it's difficult to get a large loan for "I know a secret that will allow me to double my money in a few days, honest!" so they have to make do with their savings instead.
conmod278 13d ago
"There are three ways to learn. The most noble is by thinking and getting to the truth yourself. The second, which is still pretty good, is by imitating those who do. And the third one is through pain." In prediction markets, imitation is the best policy

by echelon 14d ago

sd9 14d ago

Yes but in this case, tens or hundreds of people know the outcome months in advance. I'm very surprised that the market doesn't immediately converge to 100% for one candidate. The winner is not really a forecastable 'random event' in that by the time the show is airing, it's not being pulled from a distribution.

yorwba 13d ago
In theory, an insider willing to take any positive-expectation bet would drive the market price arbitrary close to the correct answer, but in practice they might be under NDA and want to avoid getting caught, or they limit their bet amount for other reasons, so the market ends up dominated by gamblers placing uninformed bets.
- sd9 13d ago
  Indeed, I'm just surprised. Maybe the people who could take advantage of these markets are just not sufficiently aware of their existence. I predict that in 5 years "who wins Survivor" will be completely dead though, because the markets will have become common knowledge and there'll be enough people willing to violate their NDAs/whatever for the money.
- FireBeyond 13d ago
  You say in practice, NDAs. What we've seen so far: classified military ops, people with access to Presidential speeches...
  - yorwba 13d ago
    In none of those cases did the market converge as a result of the insider betting, it was only discovered with hindsight that someone had placed a suspiciously well-timed large bet. So that's where "they limit their bet amount for other reasons" comes in. I guess it's difficult to get a large loan for "I know a secret that will allow me to double my money in a few days, honest!" so they have to make do with their savings instead.

conmod278 13d ago

"There are three ways to learn. The most noble is by thinking and getting to the truth yourself. The second, which is still pretty good, is by imitating those who do. And the third one is through pain." In prediction markets, imitation is the best policy