Introducing a new type of futures contract
Since the launch of the simExchange, the prediction market has aimed to forecast the number of units a game or console will sell. We have captured the quantity forecast for games, but we have not addressed the quality side of the games.
The simExchange is proud to announce the introduction of new contracts for forecasting game quality. The standard for quality will be Metacritic, the leading publication for review aggregation.
Metacritic futures contracts forecast the Metascore a game will receive. A Metascore is "a weighted average of all of the scores assigned by individual critics" for that game. All Metascores are between 1 and 100. Metacritic futures pay 1 DKP for each point of Metascore, so that a 90 DKP future forecasts a 90 Metascore.
The testing of Metacritic futures will begin Monday with a contract for Halo 3. This contract will enter IPO Phase 1 at 11 AM. The contract is set to freeze one week before the game's release. We will be using this opportunity to test this new type of contract, so policies regarding how this type of contract are still up to determination. Enjoy!
September 8 UPDATE: The Legend of Zelda: Phantom Hourglass (DS) has been listed for a Metacritic Future. This contract will trade slightly differently. It will continue trading until a cash out period 14 days after the game is released.
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Powertrade posted on RE: Introducing a new type of futures contract at 2:45PM PST on October 7, 2007.@Joe80, the answer is no. What you are suggesting is magic.
Here's another way to think about it. Every transaction, there are two parties. Ok, so what you are suggesting sounds great for the guy who bought. But what about the guy who is short? That means his gains are half and his losses are double.
Think about who is paying the double gains for the winner and taking the half losses for the loser--its the guy on the other side of the trade. How can this not be equal for both sides?[ Guru ] [ Level 21 ] [ Rank: 219 ]bids
1@Powertrade,
I'm not trying to argue or anything, I'm just posting about this still out of curiosity. Given the nature of MC Futures and that games can sometimes end up getting wildly unanticipated reviews, such as Lair, which people would have thought would get 75 or higher and it really got 55; doesn't this represent a type of trading where the risks can outweigh the gains in such a degree where having double on gains and halves on losses would realign gains and risks? Is there anything in the real world (not just stock market type stuff) that has extra return on gains and lower losses on risks than an equal ratio?[ Oracle ] [ Level 26 ] [ Rank: 241 ]bids
1Powertrade posted on RE: Introducing a new type of futures contract at 1:53PM PST on October 7, 2007.@Powertrade, I mean "You can't just INVENT new rules" not INVEST.[ Guru ] [ Level 21 ] [ Rank: 219 ]bids
1Powertrade posted on RE: Introducing a new type of futures contract at 1:51PM PST on October 7, 2007.@Joe80, yes, that is financially impossible. That is like saying 2+2=5 if we make the first 2 really equal 1 and the second 2 really equal 4. You can't change these things. Finance is math. Gains and losses are representations of risk an return, which have natural relationships. You can't just invest new rules. What you are saying is like trying to change the laws of physics.[ Guru ] [ Level 21 ] [ Rank: 219 ]bids
1@Powertrade,
How is it not possible? You just have a formula that takes the gain and multiplies it times 1.5 for gains and multiplies losses by .5[ Oracle ] [ Level 26 ] [ Rank: 241 ]bids
3Powertrade posted on RE: Introducing a new type of futures contract at 1:24PM PST on October 7, 2007.I'm moving the whole Metacritic futures discussion here from the Super Mario Galaxy page for obvious reasons.
@Joe80, I'm sure lots of people reply to comments as they read them, and they probably read them in chronological order, so they probably didn't see your later comments yet.
I think everyone understands your suggestion, what they are saying is it doesn't make financial sense. You can't increase gains and reduce losses, just like you can't increase return while reducing risk, just like you can't make 2 + 2 = 5. That's just how the math works.
In truth, the Metacritic Futures are low risk low return (not high risk). The return is low because the possible volatility is low. What feelmyring and Laoldar really mean is that these Metacritic futures require the same amounts of capital but have lower risk and return, which is an opportunity cost tradeoff: If put my 100k in a 10% Return On Investment (ROI) asset, I can't put it in a 25% ROI asset. Of course, the 25% returns assumes more risk.
Now I don't know why this is bad. Generally you don't want all your money in very risky assets, you want your portfolio to have everything from low risk/return money market funds to high risk/return stocks, options, and futures (with the latter being a much smaller part of your portfolio).
What people are looking for is increased leverage on the Metacritic Futures. This means taking additional risk to make higher returns. This could be achieved by requiring less principal to take on the futures contracts (like how futures work in the real world), but this would probably make things more complicated as many people here don't even understand margin for shorting. This would also require daily margin calls.
Like many things on the simExchange, these are financial issues that have been solved decades if not hundreds of years ago and there's no need to "invent" a solution. Great financial minds have thought about these issues forever. It is unlikely we will come up with a better way to structure financial products or trade on an Internet message board.[ Guru ] [ Level 21 ] [ Rank: 219 ]bids
2@GoblinMerchant,
I know that and since I made that post I have posted twice saying I realized that was a mistake... I also explained quite clearly why I would double the gain and halve losses:
"My suggestion of 50% up on gains [variable 1], 50% less on losses [variable 2] (for Metacritic Futures only) is based on the fact that users say MC Futures are not worth the gain [variable 1] and they're too risky [variable 2]."
It seems like people are selectively reading posts or people are out to get me for some reason lately because they've been ignoring things I've said, putting words in my mouth, and giving me grief for stuff that was already addressed.[ Oracle ] [ Level 26 ] [ Rank: 241 ]bids
3GoblinMerchant posted on RE: Introducing a new type of futures contract at 10:48AM PST on October 7, 2007.@Joe80, I think you've mentioned adding 0s to prices before, and as people have responded, that doesn't change anything. The percentage gain is the same. You could add 10 zeroes to a stock price and that doesn't change the forecast at all. All that matter is the amount you invest. If you invest 100k DKP in a 10 DKP stock and a 100 DKP stock, you still have 100k DKP at work. A 10% gain in either is 10l DKP.
Why would you double the gain and halve the loss? That doesn't make any sense financially =P.[ Guru ] [ Level 21 ] [ Rank: 260 ]bids
1GoblinMerchant posted on RE: Introducing a new type of futures contract at 10:45AM PST on October 7, 2007.@feelmyring, because the risk is a lot lower. Metacritic futures are lower volatility. Risk and return are alway related. Trading sales futures are not any better because your risk is going up with the return. As someone previously mentioned, the actual return on any investment is just based on how mispriced it is (how difficult it is to predict). In that case you are getting compensated for the difficulty--and it is not necessarily a better deal (likely not).[ Guru ] [ Level 21 ] [ Rank: 260 ]bids
4GoblinMerchant posted on RE: Introducing a new type of futures contract at 10:42AM PST on October 7, 2007.@feelmyring, Metacritic ratings are actually one of the most important things to forecast in the video game industry, which is why I'm sure they are included. This is one of the metrics the industry has difficult in predicting, but one of the most crucial metrics in game development. I would say getting a good Metacritic forecast is more important than a lifetime global sales forecast.
Why is all this in the Super Mario Galaxy thread?[ Guru ] [ Level 21 ] [ Rank: 260 ]bids
1@feelmyring,
I agree here to feelmring. I don't trade much of the MC but they have two upsides nothing else has: You may not be able to gain a high% but you also not loose a lot of %, therefore you can put some cash in them (time trust) if you don't know where to put it. It is most likely that you don't loose much of it. The second thing is that this behavior is very good for newbie's. That way they can learn how to trade in a not risky environment. Let them how they are. If this two upsides are not enough for you then let your money work in normal futures or stocks for you. Or do everybody here has so much money left, that they are in desperate need of an investment? I could suggest some :o)[ Oracle ] [ Level 21 ] [ Rank: 112 ]bids
1@Starless,
Yes I realized the error of my 1st suggestion right after posting it and tried to let people know. If losses are also doubled I think that will make people even less likely to participate in MC Futures then they're now. My suggestion of 50% up on gains [variable 1], 50% less on losses [variable 2] (for Metacritic Futures only) is based on the fact that users say MC Futures are not worth the gain [variable 1] and they're too risky [variable 2].
To keep the system the way it is will still have the problems people say about MC Future being not worth the gain and too risky. I like the idea of MC Futures and the idea behind why they were introduced so I'd like to see them adjusted so they're more worth it and more popular among users.[ Oracle ] [ Level 26 ] [ Rank: 241 ]bids
1@feelmyring,
Abandoning MC futures as well as adding a new type of Future would be a "fix" to the site imo, but I guess we differ on opinions about what is a fix and whats not.
If people are so negative towards MC Futures because of the huge risk and the tiny payout then my suggestion is not ludicrous at all. It makes sense. If you bid 10,000 shares on a MC Future at a score of 80 and it gets an 85, you're risking 800,000 for a gain of 50,000, and that would be a very very good outcome for a MC Future. Gaining 100,000 from that 800,000 investment would make it more worthwhile to bid on MC Futures while not inflating the gains that much at all given the risk. Likewise instead of losing 50,000 you'd only lost 25,000. If this is so completely ludicrous to you then what if it was 25% extra on gains/25% less on losses?
Would you like to share some examples where people suggested a fix to something on the SE where the aim was for players to get money thrown to them? I don't recall anything of the sort except for the 1 time Kultofcows dealt with those 3 canceled games, and he was asking us for a fix that we thought should be made. Other than that there have tons of things people on the SE have suggested as fixes that had nothing to do with money at all, sometimes we see suggestions and them implemented many times during 1 week.[ Oracle ] [ Level 26 ] [ Rank: 241 ]bids
4@Joe80,
Your first suggestion wouldn't change anything. If the contract price was increased by a factor of 10, people would simply buy a tenth of the number of contracts purchased before. This wouldn't change the amount of DKP someone has invested in a future or the percentage gain they earn from said future. I'm not sure how we would implement your second suggestion. Is KultOfCows able to do this? And if your suggestion is implemented, I would like to see both gains AND losses doubled (or triple, or quadrupled...)
I have a suggestion, but I'm afraid it may be too confusing to implement. I'll share it anyway. First we choose a MC score that we think a game will get, and set this score to 0DKP. If the score we chose was 80, then a MC score of 90DKP in the current system would correspond to 10DKP in my system. A score of 70 in the old system would be -10 (!) in my system. This would massively increase the percentage gains someone could earn on a MC future. Someone buying at 75 and the future increasing in value to 80 would net them a percentage gain of 6.7% under the old system. Under my system, the percentage gain would be dependent on what score we set to zero. If we set 70DKP to zero, the trader in the above example would earn a 100% gain. If 74 were set to zero, the trader would earn 500% gain. If 75 were set to zero, the trader would make an infinite percent gain, getting 5DKP for every contract they purchased at 0DKP! Of course, possible percentage losses would increase in the same way.
There are obviously a few problems with my system:
Negative prices will confuse the hell out of everyone. I think these futures are mostly targeted at being a fun way to get new users into trading, so this is a pretty major problem.
With the possibility of earning such high percentage gains, the MC futures may attract too much trading and not enough people would trade on other things.
I think my system would be interesting, but is probably not suited to MC future contracts.
I think the best thing we could do is just keep the system the way it is, but try to list new IPs with hard to predict review scores (games like BioShock, Manhunt 2 and Lair).[ Oracle ] [ Level 22 ] [ Rank: 12 ]bids
2feelmyring posted on RE: Introducing a new type of futures contract at 5:48PM PST on October 6, 2007.@Joe80,
What I suggested wasn't a "fix"; it was to abandon MC futures entirely. What I did suggest was a different kind of existing future (Total monthly software sales for the three major consoles).
It seems like every time someone suggests a "fix" to a flawed product, it's a way to throw money at the players. Double the payout and half the losses? That's ludicrous. What's the point of even having the future, then? Why not just suggest that the admins institute interest on available cash in addition to the time trust? Or, how about 1 million DKP for every month of membership? Even better, if your name starts with A-Y, you get a 10 million DKP bonus (sorry zakus)?
The only upside of having the MC future that I can see, is that it's an easy enough way to be introduced to the concept of futures trading. It doesn't involve a ton of risk, it has a short expiration cycle, and it doesn't require a lot of outside research.[ Oracle ] [ Level 20 ] [ Rank: 351 ]bids
3@feelmyring,
I think one reason MC Futures were introduced was to help make the site more social and increase discussion.
People try to help fix things in order to make the site better and more usable and popular. I came up with some suggestions that could fix MC futures, and my very last suggestion (2x earned, halved losses) I believe would definitely make them more traded/popular/worthy. I don't know why you're questioning people trying to fix things on a Beta site and then turning around and making the same type of suggestions in the same post.
Not to mention that Kultofcows has been very open about suggestions, asking people to make suggestions on things, and implementing a lot of them. Many suggestions made have already made the site better.[ Oracle ] [ Level 26 ] [ Rank: 241 ]bids
2feelmyring posted on RE: Introducing a new type of futures contract at 4:53PM PST on October 6, 2007.@Joe80,
Why does everyone on this site seem so intent on "fixing" everything? I understand that a lot of work went into establishing MC futures as a trading product, and that things shouldn't be dismissed out of hand, but often times, trading products fail. The MC futures are a good idea on paper, but from what we've seen, not so great in practice. It seems to boil down to two things, as far as I can see:
1) For high profile, almost guaranteed high review games, the incentive to trade is mostly removed, and
2) For the low profile games, no one really seems to care, based on trading volume.
I'm also kind of puzzled why the MC futures were added at all, given the rigorous culling of stocks to reduce clutter (and yes, I've seen the blog post). The fact that users must post comments saying essentially "Do people know that X MC future has started trading as well?" would lead me to believe that the MC future hasn't been a winning product, in the same way regular futures have.
Personally, instead of the MC futures, I'd like to see PS3, Xbox 360, and Wii software sales futures. That's just me, though.[ Oracle ] [ Level 20 ] [ Rank: 351 ]bids
1@Gaara42,
Yes. There are only 2 options I can think of to "fix" MC Futures so that people view them more positively and want to take part in them. That suggestion (make 60, 85, 92, be 600, 850, 920, etc) OR make the positive payout you receive doubled and the negative losses halved. So that if you buy at 80 and it ends at 85 you receive double what you betted, but if you bought at 85 and it ended up at 80 you only lose half of what you betted, and ofcourse do the same for shorting.[ Oracle ] [ Level 26 ] [ Rank: 241 ]bids
1@Joe80,
Are you saying if you made the range 0-1000DKP where 10DKP=1%?
I think that would raise the amount of participation in Metacritic futures but might also deter people due to the high cost. Maybe the community can vote on it and a new system could be formed (or people can vote to keep the current one).[ Oracle ] [ Level 23 ] [ Rank: 8 ]bids
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1@feelmyring,
Games like Zelda aren't the best for MC Futures. You do make the case for MC Futures not being worth it compared to other Futures or Stocks. They're just small gains to be made. Maybe MC Futures should have another digit added so that we're not bidding on scores of 85, 91, 93 but on scores of 850, 910, 930 where the 0 is just there for trading incentive and the first 2 digits reflect the score.[ Oracle ] [ Level 26 ] [ Rank: 241 ]bids
1kspraydad posted on RE: Introducing a new type of futures contract at 10:21AM PST on October 6, 2007.bids
2feelmyring posted on RE: Introducing a new type of futures contract at 10:11AM PST on October 6, 2007.@Joe80,
Lets say someone buys the Zelda MC Future for the current price (91.09 as I write this). The game gets a MC Score of 93 after two weeks. $1.91 sounds really nice. A BRAND NEW USER (with 1mil DKP) could buy 2744 shares, for a grand profit of $5241.04. Why would anyone in their right mind risk 250k for 5k? That's a stupid risk for anyone, regardless of level. There's only so much benefit to trading MC futures, and the benefit comes in for the elite players, like yourself. In the same scenario: you could buy 53720 shares for just under 5 million DKP, for a grand profit of $102,602.50.
The only way these futures are worth any REAL money is if you can buy them for a stupidly low price and they score really high (or vice versa for selling).[ Oracle ] [ Level 20 ] [ Rank: 351 ]bids
1@feelmyring,
Wouldn't the metacritic futures make you tons of money if you invested in tons of shares though.[ Oracle ] [ Level 26 ] [ Rank: 241 ]bids
2feelmyring posted on RE: Introducing a new type of futures contract at 1:22PM PST on October 5, 2007.@Alpha,
Sorry, I should have said about "the lack of immediate profit from making a fantastically wide market and having suckers hit your bids and lift your offers." There's a cap on how much money can be made on Metacritic futures. For a Zelda game, no one's going to be selling anything less than 90.
I try not to imply anything. The Metacritic futures are less profitable in the short term because people can't make $45 wide markets and reasonably expect to get fills on both sides. If there's only a few dollars to be made a few thousand times (DKP entry limits), why would anyone trade these? Personally, I think Metacritic futures are a waste of time.[ Oracle ] [ Level 20 ] [ Rank: 351 ]bids
4@Alpha,
Since Metacritic futures are more expensive than many futures contracts (80-90 DKP compared with 10-30 DKP for many November contracts), there's less risk/reward with them.
If you have, say 1 million DKP to invest you can put it for 11764 shares of Metacritic A at 85...or 33333 shares of Future B. Chances are, unless the game is a complete flop, the metacritic score will not vary by more than a few points, so you're limited to low multiple of 11764. However, sales are much harder to predict so there is a lot more variability in the price, and since you have 3 times as many shares, there's more potential profit/loss.
If you're assuming an equal investment in either a future or metacritic future, then sales futures have a much higher potential for profit/loss. Therefore, they're going to get a lot more attention. Besides, with offering Metacritic futures for every game I think we're over-saturating the market again (like what happened with stocks). Many are bound to be overlooked.[ Oracle ] [ Level 21 ] [ Rank: 182 ]bids
2@feelmyring, if you are implying that the Metacritic futures are less profitable, that would be incorrect. The only reason a contract can be less profitable is if it is more accurate...and I don't know if we are predicting Metascores more accurately than NPD sales numbers at this time. The amount of DKP price swing is irrelevant when it comes to profit opportunity. It's all about how off the market price is from true value.[ Guru ] [ Level 21 ] [ Rank: 173 ]bids
3feelmyring posted on RE: Introducing a new type of futures contract at 10:01AM PST on October 5, 2007.@Powertrade,
I think it's much more likely that people avoid metacritic futures because there's less opportunity to take advantage of wild price spreads.[ Oracle ] [ Level 20 ] [ Rank: 351 ]bids
4Powertrade posted on RE: Introducing a new type of futures contract at 8:40AM PST on October 5, 2007.bids
3Animate posted on RE: Introducing a new type of futures contract at 8:07PM PST on September 10, 2007.@feelmyring,
I agree with you. Maybe Kultofcows picked these games to debut so people wouldn't lose or gain a ton of dkp for a brand new Future, thus people wouldn't get annoyed with their first dip into the pool. And there is always the possibility of course that a game can turn out worse than expected.[ Oracle ] [ Level 26 ] [ Rank: 241 ]bids
2Laoldar posted on RE: Introducing a new type of futures contract at 8:05PM PST on September 10, 2007.@KultofCows,
As always, good points (same to the users that posted similar thoughts about quality and sales).
Maybe I just see it as pointless for titles like Zelda and Halo (guaranteed to be highly rated). If it becomes a regular future then it might be more interesting.[ Oracle ] [ Level 21 ] [ Rank: 182 ]bids
4feelmyring posted on RE: Introducing a new type of futures contract at 7:48PM PST on September 10, 2007.@Joe80,
I think a bigger issue for the first two products to debut are that they're highly anticipated games and both titles have a track record of excellence+. Halo/2 are ranked 97/95, respectively. Zelda is a little harder to gauge, but TP clocked in at 95, and Windwaker (the game this is a sequal to) scored a 96. There's not much edge in these products. Once we get into the level of excellence that these two series bring to the table, there's not really money making opportunities. If this is to be a successful idea, it needs to be for less... for lack of a better word, perfect games. How about "almost universally beloved"?
My basic point is that I don't think anyone in their right mind is going to review either of these games below the low 90's (which is reflected in my bids), but the highest possible score the game can get is 100. I don't think we need the wisdom of the crowd to tell us (or anyone else, for that matter) that Zelda and Halo games are going to get stellar reviews.[ Oracle ] [ Level 20 ] [ Rank: 351 ]bids
4Animate posted on RE: Introducing a new type of futures contract at 7:09PM PST on September 10, 2007.@jameseyryan,
I think you are overestimating how hard it will be to predict review scores, particularly in terms of getting enough info. I agree with you partly, but also think that as a community we can gain more insight than we think we'll be able to at this very moment. Some people will have read previews, participated in Betas, played demos, or followed some games very closely. If they share some of this info we gain insight, and this feature will encourage social discussion to some extent. Sure this future will probably be more volatile than most, but not all, other stocks. But that will make it different, which is good, and interesting. As we get more users, this should progress.[ Oracle ] [ Level 26 ] [ Rank: 241 ]bids
1jameseyryan posted on RE: Introducing a new type of futures contract at 6:01PM PST on September 10, 2007.@jameseyryan,
Sorry, just coincidence, I did the same for Bioshock and got an average of 94.6 versus their score of 96 so even rounding up would show a difference. So now we just need to know who they weigh for/against.[ Elite ] [ Level 21 ] [ Rank: 225 ]bids
1jameseyryan posted on RE: Introducing a new type of futures contract at 5:55PM PST on September 10, 2007.@Powertrade,
I am aware that metacritic doesn't review themselves. I was not aware that they weight the reviewers. Do they disclose how they weight them i.e. who they weigh heavily/lightly? I have only just tried Lair as an experiment but I added up the scores and divided by the number of reviews right now (24) to get 54.375 when the metacritic score is 54. Is that just coincidence on my part?[ Elite ] [ Level 21 ] [ Rank: 225 ]bids
5Powertrade posted on RE: Introducing a new type of futures contract at 5:26PM PST on September 10, 2007.@jameseyryan, you are aware that Metacritic doesn't review games directly--it aggregates nearly every credible review into a Metascoare, and weights the reviews by the credibility of the reviewer. So it shouldn't be at all necessary to understand anything about a reviewer personally.
It sounds like the biggest complaint on the quality future so far is that it is harder to predict than sales...isn't this the reason to make a predictor? If something is easy to predict, what's the point of setting up new predictors of that metric?
It's good that jamesryan is looking at all those factors to price stocks and futures, but I have a feeling that many people on here trade the stocks simply from reading the game's title, summary, and looking at a few previews and screenshots. Look at the past stock price of Metroid for example. Trying to predict how good a game will be quality-wise comes down to these same factors as well.
If you think about it, predicting a game's quality should be easier than predicting the quantity of sales as the game's quality is a subset prediction of the game's sales prediction. You already have a prediction of how good the game will be in your mind when you are making a prediction on how many copies the game will sell.[ Guru ] [ Level 21 ] [ Rank: 219 ]bids
2jameseyryan posted on RE: Introducing a new type of futures contract at 5:14PM PST on September 10, 2007.I have to be honest, i'm a little skeptical of this idea. I really don't want to be because it encourages more people who are active with games to play the games and post reviews here and talk about the quality of the game in general which will increase intelligent discussion as we had all hoped for, but I think there may be a flaw in this.
For the gaming industry we predict on the basis of hype, precedent for previous versions or similar games in a particular genre, target market for the game, time of year for release, attachment rates, install base, reviews etc. i.e. we have a lot of things to take into account and that can be a lot of information at our disposal to make our predictions with the more info leading to more accurate predictions.
If we were to trade on metacritic scores we are essentially trading on what X number of people think of the game. This "target market" is miniscule compared to what we are used to trading on and therefore can vary in great degree. For e.g. in sales we can generalise that a certain proportion of the market like hardore games, platform games etc and are likely to buy said games. To get the same kind of info that I mentioned in the paragraph above, essentially we need to know who's reviewing the game in advance of the review and also we would need personal info of their favourite genres, games they bought, enjoyed, biases they may have in the console war, the mood they are in when playing the game, writing the review etc.
Without that, it is essentially guesswork because before a game is released and reviewed what info do we have? Hype and Content Releases from the game producers. If a reviewer is worth his salt then hype should not affect his review (but surely if hype wasn't taken into account then all reviews would post a score with little variance, but look at the range Lair got, 30-90), and content releases would show all aspects including faults in the game design, which they don't as they are essentially biased to build up hype for sales. So in essence all we are trading on is "is this game overhyped for what it is?" We can do this for sales based on the information at our disposal as I have said but, we are essentially trading blind on reviews.
I don't want to seem critical but I may be because I am tired at the moment and I would like others to come and point out things I may have missed here either for or against. Depending on the potential gains I see I will use this feature and if it turns out that it works and we are accurate in predicting game review scores then I will happily welcome it.[ Elite ] [ Level 21 ] [ Rank: 225 ]bids
4Animate posted on RE: Introducing a new type of futures contract at 4:42PM PST on September 10, 2007.@justcrim,
I can see the point in predicting game reviews because those who know more about a game will know more about what review it should get, and this correlates to predicting game sales. The more you know about a game the better for predicting & reviewing, reciprocally related.[ Oracle ] [ Level 26 ] [ Rank: 241 ]bids
4KultofCows posted on RE: Introducing a new type of futures contract at 4:03PM PST on September 10, 2007.@justcrim, thanks for your input.
"Games like Fable and Brute Force which were super hyped and takes years to make came out with such low scores for what was expected of them."
This is exactly why contracts for forecasting a game's quality are important. Currently, there are no predictors of a game's quality, which is one of the most important factors for determining the success of a gaming product. BioShock's metascore was the main reason the game's stock and August future rose on the simExchange and the impetus for TTWO's stock to rise on the NASDAQ.
A game's review by critics is not a guarantee of how sales will result, but it is highly correlated. From our discussions with people in the video game industry, a predictor on a game's quality is more interesting than one for monthly sales (and much more interesting than lifetime sales).
"I think you should freeze it prior to/or as soon as any open betas and/or demos are released that let people get an early hands on."
This would be somewhat contrary to the point of the future as the goal is to forecast the review ratings for a game. Demos (such as those at E3 or other gaming conventions) are very important to achieve an accurate forecast.[ Admin ]bids
1Laoldar posted on RE: Introducing a new type of futures contract at 3:52PM PST on September 10, 2007.@justcrim,
I would have to agree. "Quality" is such a subjective term and I think that many would agree that review scores don't always reflect what the majority of gamers think.
I couldn't hurt to try it out and if other users here want it, no problem. But I fail to see the point...this will end up being a guessing game more than anything.[ Oracle ] [ Level 21 ] [ Rank: 182 ]bids
1justcrim posted on RE: Introducing a new type of futures contract at 3:32PM PST on September 10, 2007.bids
1justcrim posted on RE: Introducing a new type of futures contract at 3:28PM PST on September 10, 2007.Not to be totally negative here, and sorry if I am. But I am just not seeing the point to this. I mean, it is a cool idea, but just not something I would be interested in.
But, betting on a score of a game seems kind of pointless. Games like Fable and Brute Force which were super hyped and takes years to make came out with such low scores for what was expected of them. At the same time games like The Xbox 360 launch titles got mainly high scores for most of them being slightly above average games.
Again, I am not bashing the idea of these futures, but instead having trouble understanding the point and also the need for them. To me, this sounds more like a lottery then anything else.[ Elite ] [ Level 17 ] [ Rank: 595 ]bids
1Animate posted on RE: Introducing a new type of futures contract at 1:23PM PST on September 10, 2007.bids
3KultofCows posted on RE: Introducing a new type of futures contract at 12:19PM PST on September 10, 2007.@Joe80, it would be exactly the same amount of DKP either way. A 90 score paying 90 DKP on a 100 DKP max contract is the same as paying 900 DKP on a 1000 DKP max contract, it is 90% of the contract's value.
For example, say I wanted to invest 900 DKP. I could buy 10 contacts if it was 90/100 DKP or 1 contract if it was 900/1000 DKP. If the score was 95, you earn 50 DKP either way, or a 5.56% return.
I think you had asked a similar question regarding unit sales futures vs stocks in the past. This is a similar situation. Futures do not pay any less than stocks. How much you earn is more dependent on how much principal you invest because the % return is the same no matter how many zeroes we add to the base price of the contract.[ Admin ]bids
2Animate posted on RE: Introducing a new type of futures contract at 12:13PM PST on September 10, 2007.bids
3KultofCows posted on RE: Introducing a new type of futures contract at 2:22PM PST on September 8, 2007.@ivanassen, thanks for the input. We will be listing a few contracts set up a bit differently to see what works better. Currently Halo 3 will freeze one week before release and settle three days after the game's release. The Legend of Zelda: Phantom Hourglass will not freeze at all and will settle 14 days after the game's release.
It is hard to judge when reviews will come out so it may not be possible to freeze trading before any reviews emerge for a game. In this case we'd just let trading price in new reviews.[ Admin ]bids
5ivanassen posted on RE: Introducing a new type of futures contract at 1:31PM PST on September 8, 2007.I think paying out three days after the game is released is a bit too early.
I'm not familiar with the MetaCritic score dynamics, but I watch closely how popular games fare on GameRankings. There you will see big name sites set on a score almost simulatenously with the game release (when the embargos drop, I presume); however, in the next month or so dozens of smaller sites add their reviews, usually dragging down the score with their attempts to be seen as more objective, or the fact that they are specialized and review games quite outside of their field of competence.
I suggest using at least two weeks after the game release, preferably a month.[ Contributor ] [ Level 17 ] [ Rank: 560 ]
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I was thinking that the extra money would not come from the other side, other traders, but rather it is just added on from within its own isolated bank. So shorts would also get the 50% up, 50% less treatment. Note to anyone, I'm not trying to suggest this anymore, just talking out of curiousity.