Intrade VEEP Forecast: Win One, Lose One (but BIG!)
We all know that Intrade Political Futures got the Joe Biden pick right last week -- how well did it do with the GOP pick?
As it turns out, not so good. THEY COMPLETELY MISSED THE VEEP PICK. Not just off by a little, mind you, but off a ginormous amount.
As we have previously suggested, the political futures markets are essentially poll aggregators. There is very little wisdom amongst the crowd, other than looking at Rasmussen, Gallup, Roper, WSJ/NBC, NYT/CBS, etc. and taking a very rough average.
Just look at how the Palin VP futures Traded only yesterday: You could have bought her VP futures for 4 cents on the dollar! Some wisdom!
10 Day Chart
Note that her lifetime futures chart is only 3 months old. Forget 18 months ago -- as of 4 months ago, SHE WASN'T EVEN ON THE FUTURES TRADER'S RADAR. Over the life of the contract, she was never more 20%.
One week ago, she wasn't even in the top 3:
Note that this is not merely a case of the longshot coming in -- Palin was not polling well, so the aggregators did not pay her much attention!
Why Prediction Markets Fail (January 2008)
Presidential Futures Markets: Spurious Predictive Powers (October 2004)
Political Futures Markets? Bah, humbug (October 2004)
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» Yep, Intrade Pretty Much Missed The Palin Pick, But... from The Stalwart
Barry Ritholtz is so sharp, but when it comes to event contracts or prediction markets like Intrade, he seems to have blinders on. Today he takes on Intrade's failure to accurately predict the Republican Veep nominee. Yep, up until yesterday [Read More]
Tracked on Aug 29, 2008 12:40:11 PM
That's a, truly, inspired pick. She's a good example, from the little I know, of what's right in this 'Country'.
Personally, I didn't think the GOP had it in them.
Posted by: Mark E Hoffer | Aug 29, 2008 11:27:56 AM
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