The folks in Iowa have got their market up and running for the 2004 Presidential election. Each contract pays a dollar; as of yesterday, you can spend just over 58 cents on a Bush contract, and around 43 cents on a Kerry contract. As you can see, the futures market is bullish for Bush (hmm, there’s a slogan in there somewhere, possibly with an R rated logo) as compared to the opinion polls (right hand column, scroll down a little for a summary/average of current polling – very handy for the political junky).
The Iowa market is worth keeping an eye on – over the last several elections, it has half the forecast error of the opinion polls.
Update: For those hankering to put their money where there mouth is, and perhaps fleece a few rubes, the main page for the Iowa Electronic Futures Market is here. Sadly, there is a $500 cap on positions.
Should we not encourage democratic underworlders to “put their money where their mouths are?”
Where’s the actual place I can put my money down? Also are they taking spreads, I have a bet with a friend that Bush will win by more than 8 states.
Here’s an article which discusses the IEM and other futures markets : http://www.luhman.org/gl/article.php/20041026221257103