I have no idea what else you want to know about me. But like ‘Top Trader’ Char, I sometimes wonder some about what you all are like. (In his profile, Char asks, “Who are you? How do you play? How serious are you? What other interesting stuff do you do?”)
So here it goes: Who am I?
I’m a PhD Economist working mostly on electric power market topics. Married, kids, so on.
How do I play?
Three basic strategies, and some luck:
One: Basic research. A little time on Google goes a long way. What do I know about the likelihood of Sydney Australia having the wettest October on record? Not much, but if it is half way through the month and they are already 95 percent there, I think that they are likely to make it.
Two: Get in early. Often initial prices are equalized across the possibilities, but often the initial probabilities are not equal. Brazil and the United States were both in the World Cup in 2006, and prices may start level, but they are not equally likely to win. Take an early stake and be patient.
Three: Get in late. It’s cheap, it’s easy, but sometimes a loosely tended market will stay open past the event with prices that guarantee success. If the market will take 6 of your inklings and pay you back 10 tomorrow, it is a good deal.
I also like to arbitrage across markets when possible. While it usually isn’t as profitable as the above strategies, sometimes you can be guaranteed a profit. Arbitraging markets brings out my inner economist.
How serious are you?
Oh, not that serious. Why do you ask?
What other interesting stuff do you do?
I blog about energy economics and electric power issues and other things at Knowledge Problem. I’m also a blog author at Midas Oracle, the prediction market group blog.