Virtual Markets - August

TER now takes its monthly look at virtual markets. These are markets found on the Internet in which participants invest virtual money - no real cash - to make predictions or to assign value. These markets function like real stock and bond markets. If participants invest more in a given prediction or value, the "price" of that prediction or value gains; if participants invest less, the "price" goes down.

TER has been following the Hollywood Stock Exchange and some of the prediction markets at Inkling, including Blue Hampshire's New Hampshire Democratic Presidential Primary Market and markets created by yours truly, including the Massachusetts Fifth Congressional District Special Election. (Disclosure: I do not participate in HSX, but I do participate in the Inkling markets discussed below except for the markets that I administer.)

Hollywood Stock Exchange

Since October, TER has been following five actors on the Hollywood Stock Exchange: Parminder Nagra, George Clooney, Halle Berry, Daniel Radcliffe, and Rupert Grint. In addition, TER has begun to follow a sixth: Gary Oldman.

Five of the six actors increased in value in July: Berry, Clooney, Grint, Oldman, and Radcliffe. Only Parminder Nagra decreased in value.

Daniel Radcliffe maintained his first place standing overall following the release of the new Harry Potter movie, Harry Potter and the Order of the Phoenix on July 11. His stock price increased from $236.53 to $246.61, a 4.3 percent increase. His stock has increased by 27 percent since October.

Gary Oldman, who is also in the new Harry Potter movie, retained his position in second place among actors - and moved into second place overall - with an increase from $210.85 to $217.15 per share. (Director Andrew Adamson dropped to third place overall.)

With an increase from $199.29 to $200.55 per share, Rupert Grint (Ron Weasley) retained his third place position among actors following the Harry Potter release.

George Clooney and Halle Berry both saw small increases in the past month. Berry's was particularly noteworthy because her stock has declined substantially since October. Since early June, her stock price has increased from $94.55 to $98.05, after having decreased from an October price of $120.49. George Clooney went from $56.23 to $57.37.

Parminder Nagra again decreased in value; in the past month, her price has dropped from $13.66 to $10.93 per share. Earlier this year, her stock price enjoyed a substantial increase in price. Since October, that price has increased by nearly 95 percent. As I wrote last month, one might expect to see some increase in the coming weeks and months following the announcement that she will star in a new movie, to be called "Fallen Hero." Nagra will co-star with Naveen Andrews, who plays Sayeed in the ABC series Lost, in a film about a soldier's return and adjustment to civilian life. We have not yet seen any bump from this announcement. I will have more to say about this in an upcoming post.

New Hampshire Democratic Presidential Primary Market

A clear leader has emerged in this market.  At $29.16 per share, Sen. Barack Obama (D - Illinois) now holds a substantial lead over his rivals. His next highest competitor is Sen. Hillary Clinton (D - New York), who is at $23.78 per share. Former Sen. John Edwards continues in third place, but has dropped in price from $21.55 to $19.00 per share.

Former Vice President Al Gore has continued to increase in value, but remains far back in fourth place at $13.27 per share. The rest of the field has been far back and deteriorating. Retired General Wesley Clark is now at $6.77 per share. New Mexico Governor Bill Richardson is at $3.01 per share. Former Alaska Senator Mike Gravel is at $1.62 per share.

My Inkling Markets

I have now created three markets on the Inkling Platform, of which two are currently active. One looked at the probability that Massachusetts Governor Deval Patrick will succeed in having proposed reforms of corporate tax loopholes enacted as part of the fiscal 2008 budget process. This market ended on June 30 - I wrote about the end of this market in more detail here.  Another market looks at the Democratic primary in the special election being held in the Massachusetts Fifth Congressional District. This special election was required because Congressman Marty Meehan resigned from Congress to become the Chancellor at the University of Massachusetts at Lowell. Another market that I created in July predicts the percentage of Governor Patrick's budgetary vetoes in dollars that will be overridden by the Massachusetts legislature.

As the creator and administrator of these markets, I am not allowed under Inkling rules to participate in them.

The Fifth Congressional District market has continued to be very active and volatile. This has been, in fact, one of the most actively traded public markets on the Inkling platform ever.  275 traders have participated in this market - making more than 2,500 trades in a little more than two months - with 176 traders currently holding positions.

At the moment, Middlesex Community College Dean Niki Tsongas holds a commanding lead at $56.28 per share. State Rep. Jamie Eldridge (D - Acton) follows in a distant second place at $19.49 per share. Lowell City Councillor Eileen Donoghue, state Rep. Barry Finegold (D - Andover), and state Rep. James Miceli are far back at $12.17, $7.43, and $4.61 per share, respectively.

This observer believes that the current market levels are a reasonable representation of objective probabilities. However, the volume and volatility of the market means that it is likely to change quite a bit between now and September 4.

In July, Governor Deval Patrick of Massachusetts signed his first annual budget - authorizing $26.8 billion in spending for fiscal 2008. At the same time, he vetoed $41.4 million in spending approved by the state legislature. This market is designed to predict what percentage of the $41.4 million in vetoes will be overridden by the legislature. The market has not been actively traded; it is has had three traders who have made five trades. This market is currently at $46.10 per share - implying that 46.1% of the Governor's vetoes will be overridden. This market has been extended to October 1.

Other Inkling Markets

Inkling has markets on the Presidential nominations of both major parties, as well as a market on the eventual winner of the 2008 Presidential Election.

In the Democratic market, in contrast to the Blue Hampshire market, Sen. Hillary Clinton has retained her lead at $40.42 per share. Sen. Barack Obama is in second place at $29.95. Former Sen. John Edwards has moved back into third place at $9.97 per share, but Former Vice President Gore is close behind at $8.46 per share.

In the Republican market, former New York Mayor Rudolph Giuliani continues in first place with $30.58 per share. Former Tennessee Senator - and current Law and Order actor - Fred Thompson continues in second place at $24.85 per share. Former Massachusetts Governor Mitt Romney is in third place at $15.68 per share. Congressman Ron Paul of Texas has moved into fourth place at $6.63 per share. Arizona Senator John McCain has dropped into fifth place - and has continued to see a large deterioration in value - with a current price of $5.54. (It was over $26 two months ago.) 

In the Presidential Election market, Sen. Hillary Clinton is heavily favored to become the 44th President of the United States at $61.09 per share. Sen. Barack Obama follows at $14.30 per share. Former Mayor Giuliani is still the leading Republican at $8.00 per share.

Other markets that TER is following include ones tracking the states that the Democratic Presidential candidate is likely to win in November 2008, which teams will make it to the American Football Conference playoffs in the coming National Football League season, and which teams will make it to the Major League Baseball playoffs this fall.

TER now takes its monthly look at virtual markets. These are markets found on the Internet in which participants invest virtual money - no real cash - to make predictions or to assign value. These markets function like real stock and bond markets. If participants invest more in a given prediction or value, the "price" of that prediction or value gains; if participants invest less, the "price" goes down.

TER has been following the Hollywood Stock Exchange and some of the prediction markets at Inkling, including Blue Hampshire's New Hampshire Democratic Presidential Primary Market and markets created by yours truly, including the Massachusetts Fifth Congressional District Special Election. (Disclosure: I do not participate in HSX, but I do participate in the Inkling markets discussed below except for the markets that I administer.)

Hollywood Stock Exchange

Since October, TER has been following five actors on the Hollywood Stock Exchange: Parminder Nagra, George Clooney, Halle Berry, Daniel Radcliffe, and Rupert Grint. In addition, TER has begun to follow a sixth: Gary Oldman.

Five of the six actors increased in value in July: Berry, Clooney, Grint, Oldman, and Radcliffe. Only Parminder Nagra decreased in value.

Daniel Radcliffe maintained his first place standing overall following the release of the new Harry Potter movie, Harry Potter and the Order of the Phoenix on July 11. His stock price increased from $236.53 to $246.61, a 4.3 percent increase. His stock has increased by 27 percent since October.

Gary Oldman, who is also in the new Harry Potter movie, retained his position in second place among actors - and moved into second place overall - with an increase from $210.85 to $217.15 per share. (Director Andrew Adamson dropped to third place overall.)

With an increase from $199.29 to $200.55 per share, Rupert Grint (Ron Weasley) retained his third place position among actors following the Harry Potter release.

George Clooney and Halle Berry both saw small increases in the past month. Berry's was particularly noteworthy because her stock has declined substantially since October. Since early June, her stock price has increased from $94.55 to $98.05, after having decreased from an October price of $120.49. George Clooney went from $56.23 to $57.37.

Parminder Nagra again decreased in value; in the past month, her price has dropped from $13.66 to $10.93 per share. Earlier this year, her stock price enjoyed a substantial increase in price. Since October, that price has increased by nearly 95 percent. As I wrote last month, one might expect to see some increase in the coming weeks and months following the announcement that she will star in a new movie, to be called "Fallen Hero." Nagra will co-star with Naveen Andrews, who plays Sayeed in the ABC series Lost, in a film about a soldier's return and adjustment to civilian life. We have not yet seen any bump from this announcement. I will have more to say about this in an upcoming post.

New Hampshire Democratic Presidential Primary Market

A clear leader has emerged in this market.  At $29.16 per share, Sen. Barack Obama (D - Illinois) now holds a substantial lead over his rivals. His next highest competitor is Sen. Hillary Clinton (D - New York), who is at $23.78 per share. Former Sen. John Edwards continues in third place, but has dropped in price from $21.55 to $19.00 per share.

Former Vice President Al Gore has continued to increase in value, but remains far back in fourth place at $13.27 per share. The rest of the field has been far back and deteriorating. Retired General Wesley Clark is now at $6.77 per share. New Mexico Governor Bill Richardson is at $3.01 per share. Former Alaska Senator Mike Gravel is at $1.62 per share.

My Inkling Markets

I have now created three markets on the Inkling Platform, of which two are currently active. One looked at the probability that Massachusetts Governor Deval Patrick will succeed in having proposed reforms of corporate tax loopholes enacted as part of the fiscal 2008 budget process. This market ended on June 30 - I wrote about the end of this market in more detail here.  Another market looks at the Democratic primary in the special election being held in the Massachusetts Fifth Congressional District. This special election was required because Congressman Marty Meehan resigned from Congress to become the Chancellor at the University of Massachusetts at Lowell. Another market that I created in July predicts the percentage of Governor Patrick's budgetary vetoes in dollars that will be overridden by the Massachusetts legislature.

As the creator and administrator of these markets, I am not allowed under Inkling rules to participate in them.

The Fifth Congressional District market has continued to be very active and volatile. This has been, in fact, one of the most actively traded public markets on the Inkling platform ever.  275 traders have participated in this market - making more than 2,500 trades in a little more than two months - with 176 traders currently holding positions.

At the moment, Middlesex Community College Dean Niki Tsongas holds a commanding lead at $56.28 per share. State Rep. Jamie Eldridge (D - Acton) follows in a distant second place at $19.49 per share. Lowell City Councillor Eileen Donoghue, state Rep. Barry Finegold (D - Andover), and state Rep. James Miceli are far back at $12.17, $7.43, and $4.61 per share, respectively.

This observer believes that the current market levels are a reasonable representation of objective probabilities. However, the volume and volatility of the market means that it is likely to change quite a bit between now and September 4.

In July, Governor Deval Patrick of Massachusetts signed his first annual budget - authorizing $26.8 billion in spending for fiscal 2008. At the same time, he vetoed $41.4 million in spending approved by the state legislature. This market is designed to predict what percentage of the $41.4 million in vetoes will be overridden by the legislature. The market has not been actively traded; it is has had three traders who have made five trades. This market is currently at $46.10 per share - implying that 46.1% of the Governor's vetoes will be overridden. This market has been extended to October 1.

Other Inkling Markets

Inkling has markets on the Presidential nominations of both major parties, as well as a market on the eventual winner of the 2008 Presidential Election.

In the Democratic market, in contrast to the Blue Hampshire market, Sen. Hillary Clinton has retained her lead at $40.42 per share. Sen. Barack Obama is in second place at $29.95. Former Sen. John Edwards has moved back into third place at $9.97 per share, but Former Vice President Gore is close behind at $8.46 per share.

In the Republican market, former New York Mayor Rudolph Giuliani continues in first place with $30.58 per share. Former Tennessee Senator - and current Law and Order actor - Fred Thompson continues in second place at $24.85 per share. Former Massachusetts Governor Mitt Romney is in third place at $15.68 per share. Congressman Ron Paul of Texas has moved into fourth place at $6.63 per share. Arizona Senator John McCain has dropped into fifth place - and has continued to see a large deterioration in value - with a current price of $5.54. (It was over $26 two months ago.) 

In the Presidential Election market, Sen. Hillary Clinton is heavily favored to become the 44th President of the United States at $61.09 per share. Sen. Barack Obama follows at $14.30 per share. Former Mayor Giuliani is still the leading Republican at $8.00 per share.

Other markets that TER is following include ones tracking the states that the Democratic Presidential candidate is likely to win in November 2008, which teams will make it to the American Football Conference playoffs in the coming National Football League season, and which teams will make it to the Major League Baseball playoffs this fall.