[kristopolous]

Why would outcomes match perceptions?

The whole premise of gambling is that they don't

[gowld]

The whole premise of prediction markets is that the few people whose perception do match outcomes make bets to push the money-weighted average perception toward outcomes. If perceptions still don't match outcomes at that point, average return is 0 minus transactions, with high variance.

[kristopolous]

huh? that sounds like ideology and not empirical observation.

[bofadeez]

That's just how limit order books work with mark-to-market pricing

[xrisk]

Could you point me towards some resource that would help me understand what you wrote? Genuinely curious about how this stuff works

[eru]

https://en.wikipedia.org/wiki/Efficient-market_hypothesis might be a good start.

[kristopolous]

That's pure ideology and not empirical. There's you know, even a large section there in that article pointing that out

[bofadeez]

Step 2: https://en.wikipedia.org/wiki/Grossman%E2%80%93Stiglitz_para...

[paulddraper]

But in aggregate they might.