Wednesday, January 16, 2013 Posted by admin at 11:14 am
Tagged: Uncategorized.   3 comments.

Our Bashar al-Assad Stocks have had very high volumes for quite some time now, so much so that we have managed to launch stocks without market makers without significant instability in their pricing. We aren’t the only real money prediction market to have stocks about Mr al-Assad. Intrade have this stock which concerns his departure by 1 July 2013. It’s phrased in the reverse but essentially concerns the same outcome.

It is curious that the Intrade stock gives Mr al-Assad only a 35% chance of being Syrian President by 1 July 2013, because iPredict traders give him a 60% chance. Intrade volumes are also high, so if anyone has accounts with both markets this would present a real arbitrage opportunity a la Eric Crampton.

NC

Comment by ECrampton

Posted on the 17th of January, 2013 at 10:42 am.

It’s not a pure arbitrage play: if al-Assad loses and regains power before 1 July, then both markets could pay out at $1. That seems less likely than the 20% chance implied by the price spread between markets, but it’s worth warning about it for those who might want to run this as an arb.

Comment by admin

Posted on the 17th of January, 2013 at 11:52 am.

That’s not quite right, see the judgement statement for the iPredict stock:

“This contract will immediately pay $0 if mainstream media reports say Bashar al-Assad has lost effective control of the Syrian Government or military, or words to that effect.”

Then the Intrade stock:

“This contract will settle* (expire) at 100 ($10.00) if Bashar al-Assad is no longer the President of Syria for any reason (including death) before midnight ET on the date specified in the contract.”

So if al-Assad lost control of the government the iPredict stock would close at $0 immediately and the Intrade stock would close at $10.00 immediately. If Al-Assad regains power this would not effect the outcome.

Comment by 12.31pm

Posted on the 21st of January, 2013 at 2:03 am.

well, maybe someone has taken up your advice since intrade is sitting at 51% now!

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