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Put Your Money Where Your Mouth Is...

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krazy kaju Posted: Mon, Oct 5 2009 3:00 PM

And trade "predictions" at intrade.com.

I'm going to be opening an account soon. There seems like there are some good trades one can make in regards to US unemployment and GDP numbers. 

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Very interesting.  What happens when the prediction is settled at its closing date?

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From what I understand, if it happens, then the price is 100. So if you bought at, say, 77, then you are up 33 points. If it doesn't happen, then the price is 0. So if you bought at, say, 35, you are down 35 points.

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filc replied on Tue, Oct 6 2009 12:11 AM

Why use intrade? So many other better stock brokers out there.

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filc replied on Tue, Oct 6 2009 12:13 AM

NM I get it... :)

Actually clicked the linky!

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So...how would you make money on predictions you thought would not occur - the ones that go to $0?  No matter where you buy you would lose money if you held out until the end, right?

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Sage replied on Tue, Oct 6 2009 11:23 AM

Sounds like a good way to see if the Peak Oilers really believe in their theory.

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I'm pretty sure there is some form of short selling available. I haven't used it yet, so I can't say positively.

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BobT replied on Tue, Oct 6 2009 10:01 PM

krazy kaju:

I'm pretty sure there is some form of short selling available. I haven't used it yet, so I can't say positively.

You can sell as well as buy, yes. As far as I can tell its like this - if the bid and ask prices were 30, you could:

Buy - if the event happens, you win 70, if not you lose 30

Sell - if it happens you lose 70, if not you win 30.

 

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