Monday, February 25, 2008

Prediction Market Graphic



This is a graphic from a prediction market website, showing the transaction price for an option that pays $100 if Barack Obama wins the Democratic presidential nomination. The current share price is $81.5, meaning that the chance of the event happening is about 81.5 percent. Note that there are two line graphs: the thick blue one shows the transaction price, as measured on the right-side axis. The thin green line measures the trading volume (how many shares are bought and sold each day), as identified by the left-side axis. For the most part, the graphic is well-organized, but the scale for the trading volume could be expanded a bit so that the green line is more noticeable. Substituting a brighter color for the fairly pale green would also help.

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