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Nothing Ever Happens: Polymarket bot that always buys No on non-sports markets

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Re: Nothing Ever Happens: Polymarket bot that always buys No on non-sports markets

#191

Post by jonahx »

hamasho wrote: post #190
jfengel wrote: post #180

Earlier quoted context omitted.

If they're appropriately priced, you can't win money at all, unless you have insider knowledge.

I hate that many people or even the news and scientists have already started to see the odds of prediction market as fact. I'm sure in the near future, policy decisions or war strategies will be decided by prediction markets' odds, if they are not already being used.

They're far from facts, but have an important advantage over most other sources: the bettors are motivated to predict truth.

News sources are motivated to get clicks, to appeal to certain audiences, and to retain tribal customers. None of these create incentives for truth. You can seek out smart, well-informed and principled journalists who will prioritize truth-seeking over money-making. There are some. But the fact remains you are relying on character to override incentives. With prediction markets, incentives and truth are naturally aligned. This makes them a powerful and valuable resource imo, even if there is a lot of scumminess that comes along for the ride. The insiders, more than anyone, are contributing to the truth signal.

Re: Nothing Ever Happens: Polymarket bot that always buys No on non-sports markets

#192

Post by Geezus_42 »

jonahx wrote: post #191
hamasho wrote: post #190

Earlier quoted context omitted.

I hate that many people or even the news and scientists have already started to see the odds of prediction market as fact. I'm sure in the near future, policy decisions or war strategies will be decided by prediction markets' odds, if they are not already being used.

They're far from facts, but have an important advantage over most other sources: the bettors are motivated to predict truth. News sources are motivated to get clicks, to appeal to certain audiences, and to retain tribal customers. None of these create incentives for truth. You can seek out smart, well-informed and principled journalists who will prioritize truth-seeking over money-making. There are some. But the fact…

They are motivated to pick what they believe is most likely to happen. The develope their idea of what is most likely to happen for the news. The reporters use their bets to wrote stories predicting what will happen.

See the loop?

Re: Nothing Ever Happens: Polymarket bot that always buys No on non-sports markets

#193

Post by conductr »

kelvinjps10 wrote: post #117
conductr wrote: post #58

Earlier quoted context omitted.

Except, the thing is, a decent portion of the population enjoys throwing money away in casinos. If they feel a similar level of enjoyment/entertainment from this type of market, then it's no different and they're playing for a non-financial purpose that your calculus isn't pricing in. Maybe a stretch but theoretically, if they enjoy it enough, it can serve as a much cheaper alternative to a casino and thus could actu…

how can it be cheaper? people will spend the same amount or even more considering that is more easy to spend more since it's digital

It's all hypothetical of course but I know Vegas has some high table/game minimums and these markets can be pretty cheap if you just want a piece of action. Also, eliminates the cost of actually traveling.

Again, no idea if anyone sees this as a true substitute or not. My guess is not as Polymarket bets don't feel entertaining at all (IMO). So it's not filling that void for anyone, but it hypothetically could.

Re: Nothing Ever Happens: Polymarket bot that always buys No on non-sports markets

#194

Post by eru »

khimaros wrote: post #188
okhobb wrote: post #183

Earlier quoted context omitted.

The purpose of prediction markets is to communicate insider knowledge.

https://en.wikipedia.org/wiki/The_purpose_of_a_system_is_wha...

Compare and contrast https://www.astralcodexten.com/p/come-on-obviously-the-purpo...

Re: Nothing Ever Happens: Polymarket bot that always buys No on non-sports markets

#195

Post by eru »

Geezus_42 wrote: post #192
jonahx wrote: post #191

Earlier quoted context omitted.

They're far from facts, but have an important advantage over most other sources: the bettors are motivated to predict truth. News sources are motivated to get clicks, to appeal to certain audiences, and to retain tribal customers. None of these create incentives for truth. You can seek out smart, well-informed and principled journalists who will prioritize truth-seeking over money-making. There are some. But the fact…

They are motivated to pick what they believe is most likely to happen. The develope their idea of what is most likely to happen for the news. The reporters use their bets to wrote stories predicting what will happen. See the loop?

No? Where's the loop?

Re: Nothing Ever Happens: Polymarket bot that always buys No on non-sports markets

#196

Post by eru »

Cthulhu_ wrote: post #149
bargainbin wrote: post #111

Earlier quoted context omitted.

71 cents*, the bookie gets a cut either way it goes.

This is the truth of the matter, ultimately nobody wins except the bookie, who profits either way.

Hedging can itself be a useful service, even if the customer doesn't make money on average. Have you heard of insurance?

Re: Nothing Ever Happens: Polymarket bot that always buys No on non-sports markets

#197

Post by eru »

zahlman wrote: post #123
bargainbin wrote: post #111

Earlier quoted context omitted.

71 cents*, the bookie gets a cut either way it goes.

Even if a cut isn't taken and there aren't other inefficiencies, any money tied up in long-term predictions is earning 0% instead of whatever the current risk-free rate of return is.

Earning less than the risk free rate is a 'cut being taken'.

Re: Nothing Ever Happens: Polymarket bot that always buys No on non-sports markets

#198

Post by eru »

dlgeek wrote: post #182
bargainbin wrote: post #111

Earlier quoted context omitted.

71 cents*, the bookie gets a cut either way it goes.

Wouldn't it be 75 cents then? (The cut would come out of higher pricing, since the payout is always a dollar).

Well, 75 cents for you buying the bet, 71 cent for you selling the bet.

Or something like that.

Re: Nothing Ever Happens: Polymarket bot that always buys No on non-sports markets

#199

Post by eru »

cortesoft wrote: post #186
Majromax wrote: post #173

Earlier quoted context omitted.

'Enough' [capital] is doing a lot of work in that sentence. In the limit of a one-sided irrational market, the 'rational actor' would need to take the other side of every open transaction.

Yeah, but in the limit of a one-sided irrational market, the rational actor is going to be given as much capital as he can take.

In the long run. In the short run, our rational actor will be constrained by the Kelly criterion, well and whatever outside funding she can raise.

Re: Nothing Ever Happens: Polymarket bot that always buys No on non-sports markets

#200

Post by eru »

wat10000 wrote: post #128
mrandish wrote: post #124

Earlier quoted context omitted.

> I bet the average price for a no bet across these markets is 73 cents. Behavioral economics has already answered the question of whether humans are, on average, perfectly rational economic actors. They are not. To the contrary, there is substantial evidence indicating a meaningful number of humans will mis-estimate the likelihood of uncommon future events.

That doesn't matter so much when it happens in a place where people can make money from other people's irrationality. Even if there are a bunch of irrational people placing bad bets on uncommon future events, rational people looking to make a buck will take the other side of that bet, until the price is sensible. The alternative would be that there's a bunch of free money sitting there waiting for someone to decide t…

Actually, having a bunch of noise traders around is a great attraction for the ration people to show up.
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