Ultimately, markets are driven by the need for exchange of risk. On one side are parties who wish to hedge their risk (oil producers, farmers, companies with Forex exposure, etc). On the other are speculators who will take on that risk in exchange for getting the positive-expected-value side of most trades.
Sports betting is a bit the opposite, in that there are gamblers who want volatility, and sharps/books who will provide that to them, again, in exchange for the +EV side of most trades.
Prediction markets offer neither - there is minimal gambling demand and essentially zero hedging demand.
1 comment
[ 5.8 ms ] story [ 15.6 ms ] threadSports betting is a bit the opposite, in that there are gamblers who want volatility, and sharps/books who will provide that to them, again, in exchange for the +EV side of most trades.
Prediction markets offer neither - there is minimal gambling demand and essentially zero hedging demand.