Monday, June 30, 2008
For one of my courses I was tasked with coming up with a pitch for a prediction market. Essentially in a prediction market has given assets where you get paid out if an event happens and the price of the asset is essentially the group wisdom of the likelihood it will happen. So if an asset is selling at 50, than the public thinks its 50/50 that the action will happen and they will receive the 100 payout. Just think of it like gambling on predictions just in a stock way. An example of a prediction market is Tradesports.com .
Anyway I wrote my paper on creating a predciction market based solely on the MLB draft so if you care to read 5+ pages of joy here's The Papel.