13

Pricing in a Conservative win


 

Price of Contracts on Conservatives to Win Most Seats in Next Federal Election at intrade.com
Price of contracts on “Conservatives to Win Most Seats in Next Federal Election” at intrade.com.

Price of Liberal contracts (latest closing price = 34.0) moves more or less inversely to Conservatives’, as no other party has a reasonable shot at winning a plurality.

Intrade has not as yet set up a market on majority versus minority for either party.


 
Filed under:

Pricing in a Conservative win

  1. Oh, come on. Look at the trade volumes. A handful of partisan enthusiasts willing to spend $20 in order to generate an internet buzz/meme could kick that number up to 1.00 or down to 0.00 with almost no effort.

    When I participated in one of the UBC election markets, I made a decent return just by cashing in on pure arbitrage opportunities.

    This is a typical Canadian market: thin, and easily-manipulated.

  2. It’s like a choice between Canwest or Maple Leaf stocks. Let the manipulation begin!

  3. The question is are many Liberals willing to waste their own money to push their share price up?

    The leader might be he’s already in debt up to his spectacles.

    Hi-yo!

  4. Whichever side I bet on, I would lose.

  5. So lets see,

    the polls that show Dion failing miserably in Quebec, are unreliable,

    the market showing confidence in a Dion loss are being “manipulated”,

    the basic logic of most Canadians not wanting to see their fuel prices to up even higher, is flawed,

    a working mom who has to tell her daughter that the road trip to Maine they’ve been planning all year has been canceled because fuel prices are just too high, has at the forefront of her mind, not her crushed daughter’s feelings and the general well being of her family, but some allegations of insider politico deal with a dead guy and some politician that took place years ago,

    the trucker who has to tell his wife to get a second job because his cost base (mostly fuel) has taken away his profits, will realllly have the conservative’s internal accounting and funds transfers at the forefront of his mind (as much as the average staunch liberal blogger anyway),

    I think election night is going to hit the core Dion supporters like a ton of bricks. Blind partisanship makes for good feelings for the time being, but that bubble bursting can really leave a sting.

  6. Yes, it’s possible that Liberal/Conservative/NDP operators might go into these markets and place orders in order to push prices around rather than to make money. But guess what: if they do this, they increase the incentive for anybody else who’s profit-motivated to get into the market and take their money. And, this has been proven experimentally. Ryan Oprea and Robin Hanson went in the lab, set up an environment very similar to this, and threw in a few market manipulators whose objective was to push the price around. The presence of these manipulators made market outcomes more efficient, not less: they increased the rewards for informed profit-seeking traders. Too lazy to do the Google Scholar search on your own? Try here: hanson.gmu.edu/biashelp.pdf .

    The more you think that shady political operators will be mucking about in these markets, the more you should be watching the markets for profit opportunities.

  7. Or in other words, if you know the future, you can make money from people who don’t.

    Yeah, that’s been pretty much a given since barter was figured out.

  8. oh the Kody con job continues. The mommy who expects Harper to ‘lower’ the price of gas isn’t interested in waterfront property on Baffin Island; the trucker who hopes that Harper will balance the environment with economic responsibilities has already parked his truck; and those who expect someone else to fix all their woes and tribbles are eagerly counting on Capt. To-Tell-A-Lie harper.
    He’s already sided with Big Oil, who will give you no say in either argument.
    Those who are interested in personal responsibility that would be rewarded by wiser choices and lower income taxes, have already left Kody’s tinfoil tent.

  9. Have you looked at the market today? No trades, but now there are 50 bids at 64 (last closing was 65), and another 100 at 60. And on the other side, there are tripwires of 50 offers at 60 and 75. Well done, you brave bands of completely uncoordinated agents who seek nothing but to leverage political acumen into financial gain!

    A more cynical observer might conjecture that maybe neither side wants to see another story on the lines of ‘the election market has spoken’, and that they have unleashed the vast resources necessary (more that $100 each!) to make it happen.

    And if they achieve that goal, it would not be a bad thing. For all of us.

  10. Have you looked at the market today? No trades, but now there are 50 bids at 64 (last closing was 65), and another 100 at 60. And on the other side, there are tripwires of 50 offers at 69 and 75. Well done, you brave bands of completely uncoordinated agents who seek nothing but to leverage political acumen into financial gain!

    A more cynical observer might conjecture that maybe neither side wants to see another story on the lines of ‘the election market has spoken’, and that they have unleashed the vast resources necessary (more than $100 each!) to make it happen.

    And if they achieve that goal, it would not be a bad thing. For all of us.

  11. Stephen: if you think that the orders in the Tory book were placed by Tories trying to keep the prices in a high range, and that that range is higher than is warranted by the underlying probabilities, it’s very easy to set up an account with InTrade and to take their money from them. Just go in and short Tory. Simple. If you’re not doing that, you mustn’t put too much faith in the analysis you’re giving.

  12. I suppose I could, but I don’t have the resources to prevent the sort of price movements that would lead journalists to breathlessly announce: “The market is moving! Here are several paragraphs of speculation as to why!”

    We get rather enough of that in the financial pages.

Sign in to comment.