Prediction markets are a tool for collecting and aggregating opinion using market principles. Enterprise prediction markets are in use in 100-200 large organizations for project management and revenue forecasting. Public prediction markets are used for event prediction (election results, product sales, box office receipts).

1. Live Prediction Markets Simulation Futures & Forecasting - Quantitative Methods Melanie Swan Principal MS Futures Group +1-650-681-9482 @LaBlogga [email_address] www.melanieswan.com July 19, 2011 Slides: http://slideshare.net/LaBlogga Image: http://wall.alphacoders.com/ SU GPS for the Mind: www.mindtimemaps.com/start/sugp SU Prediction Market: gsp11.inklingmarkets.com

6. Prediction markets definition Prediction Markets July 19, 2011 Images: http://www.intrade.com Prediction markets are a tool for collecting group opinion using market principles Research has shown that prediction markets can develop more accurate forecasts than polls or experts 1 1 Source: Trepte, K. et al. Forecasting consumer products using prediction markets. MIT. 2009. http://dspace.mit.edu/handle/1721.1/53546

10. Prediction market view: Obama in 2012 Prediction Markets July 19, 2011 Source: http://www.intrade.com Blip: May 1, 2011, Osama bin Laden killed

11. U.S. congress to lift debt ceiling? Prediction Markets July 19, 2011 Source: http://www.intrade.com

16. HSX – Harry Potter 8 (July 15, 2011 release) Prediction Markets July 19, 2011 Source: http://www.hsx.com Jul 15, 2011 Jul 11, 2011 Jul 17, 2011

17. Gaming prediction market - simExchange Prediction Markets July 19, 2011 Source: http://www.simexchange.com Released: Jun 7, 2011 Release date: expected Apr 2012

19. IEhM: anatomy of disease eradication Prediction Markets July 19, 2011 Source: http://iehm.uiowa.edu

21. Futurist prediction markets – LongBets Prediction Markets July 19, 2011 Source: http://www.longbets.org/bets

24. Broader context: markets are the platform Prediction Markets July 19, 2011 Roles of markets Source: Swan, M. New Banks, New Currencies and New Markets in a Multicurrency World: Roadmap for a Post-Scarcity Economy by 2050, presented at Create Futures IberoAmérica, Enthusiasmo Cultural, São Paolo Brazil, October 14, 2009. http://melanieswan.com/documents/economy_20.pdf Types of markets Resource allocation Exchange: supply & demand meet Information (price) discovery Value identification & attribution Utility creation Traditional markets      Prediction markets    Affinity capital    Multicurrency society   Automatic markets   Ideas marketplaces  Scarcity management / abundance injection (PSE)   

26. Questions? Melanie Swan Principal MS Futures Group +1-650-681-9482 [email_address] www.melanieswan.com Slides: http://slideshare.net/LaBlogga Creative Commons 3.0 license SU GPS for the Mind: www.mindtimemaps.com/start/sugp SU Prediction Market: gsp11.inklingmarkets.com Image: http://wall.alphacoders.com/