Tim: but don’t prediction markets have a lot of benefits compared to stock markets? They terminate on usually set dates, they’re very narrowly focused (compare ‘will the Democrats win in 2008’ to ‘will GE’s stock go up on October 11, 2008’ - there are so many fewer confounding factors for the former), and they’re easier to use.
Well, you don’t have to use the fake-money ones. Intrade and Betfair have always seemed perfectly serviceable to me, and they’re real money prediction markets.
On a related point, fake money could actually be good. There’s less motivation to bet what you really truly think, but not wagering real money means you can make trades on just about everything in that market—you aren’t so practically or mentally constrained. You’re more likely to actually play, or play more.
(Suppose I don’t have $500 to spare or would prefer not to risk $500 I do have? Should I not test myself at all?)
Tim: but don’t prediction markets have a lot of benefits compared to stock markets? They terminate on usually set dates, they’re very narrowly focused (compare ‘will the Democrats win in 2008’ to ‘will GE’s stock go up on October 11, 2008’ - there are so many fewer confounding factors for the former), and they’re easier to use.
Prediction markets as implemented in the real world mostly use fake money, which is a drawback.
Well, you don’t have to use the fake-money ones. Intrade and Betfair have always seemed perfectly serviceable to me, and they’re real money prediction markets.
On a related point, fake money could actually be good. There’s less motivation to bet what you really truly think, but not wagering real money means you can make trades on just about everything in that market—you aren’t so practically or mentally constrained. You’re more likely to actually play, or play more.
(Suppose I don’t have $500 to spare or would prefer not to risk $500 I do have? Should I not test myself at all?)