Open Prediction Markets

I'm a big fan of HubDub. The user interface for events and trades is very easy to understand. And, lucky for me I'm in the top 10% of the leaderboard (my hubdub profile).

Recently, Simon Owens interviewed Nigel Eccles (who has no home page to link to...). The interview covered both HubDub and the sub-site PunditWatch which tracks pundits.

The "gaming" of anything is generally bad. In the case of prediction markets, there are occasionally some which easily be gamed by a broad audience. There is a new market on hubdub for:

How many results will a Google search for 'Switchy McSwitchenstein' yield by the end of April 2008?

Happy Path Trading

The "happy path" is done (has been for a while actually). You can buy/sell portfolios of contracts. You can buy/sell individual contracts as long as the number you want to buy/sell matches perfectly with someone else. This is pretty exciting to me. I've even got some validation at order entry and trade execution to make sure things "good."

Some Oddball Paths

Partial match (and vice versa):
1. Order placed for 100 items
2. Match placed for 50 items
3. Match satisfies the first 50 and is executed/closed

There were recently two launches of prediction markets that are worth writing about: HubDub and The Industry Standard.

Prediction Market with News Aggregator

No code discussion here - just information on what prediction markets are. Especially in light of some recent criticisms from the Democratic New Hampshire primary election, this overview post on the Mercury blog is really informative. It walks through how to interpret prediction markets

One of the hardest things to do is understand how often you can lose when betting on a favourite. Let’s do some simple math:...95% - 1 in 20 favourites will lose

I think I might drop "refactoring" from my descriptions because frankly small amounts of that are going to happen way to much to bother bringing up every time. But again, I did some ;)

Workflow States

I decided on the Workflow module which is simple to use, simple to setup and provides everything I need. It was particularly useful watching the video (available from the project homepage) .

More refactoring

I need to track trade status. Here's what I said about it briefly in my last post:

In today's update there are a few additions:

Complete Buying a Portfolio

You can buy/sell an entire portfolio. I keep doing it just for fun. This will record a purchase of 1 of every contract in the portfolio. This has removed a lot of my previous TODO entries from the hook_nodeapi which feels great. I even added in some more comments.

Transaction Support

One concept that I knew I would have to include was transactions. When you buy or sell something 2-4 things have to happen

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So, I just did the first checkins of code into the cvs repository for Drupal.

There are two things that I think people should get out of this set of code:

So, the first post. I'm going to use the blog here to document progress on the module and design decisions. The goal is to allow others to provide input and to make this module building exercise an open learning situation for people who are interested. The first step is to lay out the initial set of requirements. For the first iteration, my goal is to implement the bank accounts, objects and facility to store the purchasing/trading of contract groups, and the "happy path" through the purchase/sale of a contract group as a whole. "Happy path" means no validation just yet. I've also mentioned (here and in //TODO comments in the code) some things I know I will need to do but that I don't want to worry about now.

Attached is a diagram of some of the initial thoughts - a sort of object/relational map and also a tiny workflow. If you like pictures, maybe that will help more than my descriptions.