Insights For Success

Strategy, Innovation, Leadership and Security

Investments, MoneyEdward KiledjianComment

Humans are very opinionated. We have opinions about politics, economics, sports and everything in between. Enter the wacky world of prediction markets. These are speculative markets where market participants bet on future uncertain events.

Just like the stock market, you make money by buying low and selling high. The most popular of these markets is InTrade.

"Intrade isn't just an entertaining website.  It is the latest iteration of one of the most important economic developments of modern times."

David Leonhardt, Economics Reporter, The New York Times

It is important to note that many economists denounce the accuracy of these new markets but I am willing to bet most of the participants just want to make a bet and hope for the best (like the lottery, casino or stock market).

As I write this, the most popular "markets" are US politics:

 

The concept is pretty simple. If you believe the event being sold will occur then you BUY the market. If you think the event being sold will not occur then you SELL the market.

Intrade itself is a market and not a market maker. This means that in order for you to buy or sell, someone else in the market must be willing to take your counter-trade (aka an opposite position). If no one is willing then you cannot enter or exit a trade. Intrade is not a market maker and will NOT take your counter-trade.

Ok Mr know-it-all, this is your chance to prove just how good your instinct is.