Futures Trading Game

Researchers from the University of Iowa used prediction markets to forecast influenza activity during the swine flu pandemc. In other words, they applied market analysis typical of Wall Street in a new and unique way. The conclusion they reached was that this was a highly effective method for predicting the early dissemination of a pandemic like swine flu.

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They invited health experts to participate in an influenza H1N1 futures prediction market. These “traders” are experts in information about the forthcoming event. Participants were encouraged to “buy” undervalued and “sell” overvalued predictions. Future value is a prediction of a future event. Each trader has different information that was revealed anonymously and aggregated. The final outcome had to be eventually known.

While effective, prediction markets have different applicability than surveys. An effective trading base has to have many different kinds of input such as physicians, nurses, pharmacists, clinical microbiologists, teachers, administrators, public health practitioners, and first responders.

The flu market has a website with more information and opportunities for participation.