[ I N D E P T H ] benefits that the data provided from these markets can offer.
While the entire industry is not unanimous on how beneficial prediction markets may be to them, data is one section of this landscape that appears to have piqued the interest of many, including the buy-side. Specifically, prediction markets can quantify uncertainty around complex and rare events, providing real-time probabilities for geopolitical and economic outcomes, as well as price and behaviour shifts, which can act as early risk signals for traders, and the wider industry.
Taking this into account, murmurs across financial markets are recognising the invaluable nature of these signals, to act as market data services that can be used across many aspects of the industry, such as for navigating complex market dynamics, which could become a niche input for quantitative strategies.
Speaking about this interest, Forster said:“ In the short term, data is the low hanging fruit of prediction markets. Unlike 24-hour trading, there ' s demand from the institutional equities investment community- not
“ Prediction markets offer a glimpse into how institutional risk may be expressed in the future.”
ROB FLATLEY, CHIEF EXECUTIVE,
TS IMAGINE
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