Intrade and Betfair have different odds on Romney/Obama.

Prediction Market Arbitrage Opportunities

Moneybox
A blog about business and economics.
Nov. 6 2012 9:54 AM

Prediction Market Arbitrage Opportunities

1352213696203

Just about the clearest illustration you could ask for that prediction markets aren't quite ready for prime time yet is this whopping divergence between the odds of an Obama victory that are available on Betfair versus Intrade.

In a proper "efficient" market, arbitrageurs would take advantage of that money-making opportunity and in doing so would end up closing the price divergence. But there simply isn't enough money at stake to create the kind of deep liquid markets where that happens.

Matthew Yglesias is the executive editor of Vox and author of The Rent Is Too Damn High.

  Health & Science
Science
May 29 2015 11:55 AM San Andreas Is a Crock But there’s a reason West Coast geologists are fixated on the “big one.”