In a new interview on the PBS Wisconsin program, Here and Now, Wisconsin School of Business Risk and Insurance Professor Justin Sydnor discusses the ideas and implications behind prediction markets, the online trading platforms where participants can buy and sell shares based on the outcomes of future events.
These prediction markets are on the rise, especially in the sports world, where users can predict outcomes for specific athletes or teams. However, as Sydnor discusses, these markets could have implications outside of the sports world, with large hedge funds already pooling investments into such markets for real-world scenarios besides sports.
Additionally, Sydnor goes into detail about the risks associated with such explosive growth, including a lack of clarity among federal and state governments regarding prediction market legality, and a struggle from lawmakers and regulators to catch up.
“I think, especially for individuals, you need to be careful not to put a ton of money into these sort of markets, because there are just a lot of cases where we don’t fully understand the scope for things like insider trading.”
Watch the video for Sydnor’s insights on the current prediction market landscape.
Justin Sydnor on the rapid expansion of prediction markets | Here & Now