June Roy Morgan: National and Labour polls

Alan, I know what you mean. Would it be better if the MM simply switched off altogether, rather than offering mostly-pointless 1-stock orders?

For what its worth, I think it is a common newbie mistake to order, say, $50 worth of stock on the simple screen and then watch as your order pushes the price from $0.40 to $0.70 or something equally embarrassing. I know I did it when I first started trading during the 2008 election! It didn't happen a second time, though. :-)

pipe42 Wrote:
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> Alan, I know what you mean. Would it be better if
> the MM simply switched off altogether, rather than
> offering mostly-pointless 1-stock orders?
>
> For what its worth, I think it is a common newbie
> mistake to order, say, $50 worth of stock on the
> simple screen and then watch as your order pushes
> the price from $0.40 to $0.70 or something equally
> embarrassing. I know I did it when I first
> started trading during the 2008 election! It
> didn't happen a second time, though. :-)

sorry to sound like a newbie, how do you go about making a large order of say $50 worth of stocks with out pushing up the price?

fendt Wrote:
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>
> sorry to sound like a newbie, how do you go about
> making a large order of say $50 worth of stocks
> with out pushing up the price?
>

You can't control that - it will depend on the depth of offerings on the board.

It could be that you only take up half of what is offered at the top of the board, or it might be that you are buying up every single stock on offer - it just depends on what is there.

Alan.

@Fendt: use the advanced trading platform, specify the price at which you'd like to purchase stocks and the number of stocks at that price (making sure Q*P=50), then wait for folks to take up your offer.

pipe42 Wrote:
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> Alan, I know what you mean. Would it be better if
> the MM simply switched off altogether, rather than
> offering mostly-pointless 1-stock orders?
>

That is my view yes - I would rather it was not there at all than offering single units.

As a 'second best' alternative, I would like to see it seeded with reasonably large offerings (at least 10 units), but E Crampton implies above that the reason it goes to singles is that it is costing too much - I don't know myself, but he is probably right.

Alan.

MM loses money to the extent that its initial seeded price differs from the "true" probability and proportionate to the volume of contracts traded between the start price and the "true" price; it then also loses money whenever information is revealed that humans trade against but MM doesn't. When markets open and near closing is when most of that happens, and so liquidity is thin at those points.

Quote
Alan3285
I guess we could all sit here and look for abitrage opportunities only, but that doesn't seem to be very interesting or useful in terms of predictions.

Alan, just putting your argument with ECrampton to one side, I'm not sure you understood my post. It's not about arbitrage, it's about hedging. They're different. (I guess you could consider arbitrage an extreme example of hedging where you offset some of your positions against others such that the overall risk is 0.)

You don't need the MM to arbitrage, you simply look at the first order in the order book and the opportunity is either there, or it isn't. It's an either/or situation.

When hedging you need to execute multiple trades simultaneously, which we can't do with the current trading interface; all bids and asks in the order book can be (and normally are) executed independently. The only way around this is small trades against the order book where the bids and asks are near the most recent trade. This is where the usefulness of the MM becomes apparent. There's always somebody (something) ready to trade with you, so you don't need to leave orders up and pray that they're all hit simultaneously.

Having said that, I do of course leave large orders up on mutually independent stocks, and I also leave large orders up on the Roy Morgan stocks when I think the pricing is hugely out of line with what it should be (that's how I built up such a large NAT.VLOW position at an average price of $0.13 - I believe that that was more than a fair price right up to the release of the latest Roy Morgan poll.)

As for MM peg size, obviously the more the better, but as ECrampton pointed out it isn't up to us to decide, it's iPredict who's funds take the cop so it's their call.

Otherwise I agree with all of Ecrampton's points above.

Does anyone know when the next Roy Morgan poll is due out?

hidn Wrote:
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>
> When hedging you need to execute multiple trades
> simultaneously, which we can't do with the current
> trading interface; all bids and asks in the order
> book can be (and normally are) executed
> independently.
>

Does the multi-trade fascility cover this off for you?

It seems that I can setup multiple trades, and then execute all of them with a single click now.

Alan.

Polls out from May 31 to June 13th 2010

National 50.5 % (National Mid Stock)
Labour 33 % (Labour Mid Stock)
Green 9.5 %
Act 1 %
Maori Party 3 %
United Future 1 %
Progressive Party ^
NZ First 1.5 %
Other 0.5 %



Edited 2 time(s). Last edit at 06/18/2010 06:45AM by Eclipse.

Well done Eclipse, I assume you were the first to move on the new at 6:19?

Indeed that was me, except I'm pretty sure there was at least 2 more people trading at the same time, one possibly doing a multitrade so I got to one stock first and couldn't really shortsell the other as someone had already done that.
As well someone seemed to be selling the losing stock in what looked like an automatic arbitrage on all the stocks, I could be wrong but that's what it looked like before the prices went to the levels it should have been (only came down a few cents however).

Only made just over a hundred on it annoyingly, trying to get my account back up to pre-uk.election levels. Hope you made something off it.

These can close now... please remove all the red ink!

Thanks for closing the NAT.JUN and LAB.JUN stocks admin. Will TAXREF follow shortly?

Why are the conditional contracts still open...should have been closed two weeks ago!!!

@Legs

They were so complicated nobody could figure that part out.