Market Director
Prof. Werner Antweiler
Market Director


The Sauder School of Business Prediction Markets were launched in January 2013 as the successor to the UBC Election Stock Market, which operated from 1993-2008 and covered Canadian federal and British Columbia provincial elections. The Sauder School of Business Prediction Markets cover a wider range of events (political, economic, environmental) and operate continuously. Prediction markets are an exercise in "crowdsourcing" and have been very successful in the past.

Market Director is Professor Werner Antweiler, who has also developed the trading platform and web interface. Prof. Antweiler was co-director of the UBC Election Stock Market during its operation. An Advisory Council to the Sauder School of Business Prediction Markets is comprised of experts in related disciplines: political science, economics, and business admininistration.

Questions and Answers

What are the objectives of the Sauder School of Business Prediction Markets?
    We have four objectives. First, investors are trying to predict the outcomes of political events, in particular elections. Efficient markets are very good at reflecting all available information and can often reflect information faster than opinion polls that take several days to complete and process. To this extent the markets have a public service function. Second, the researchers learn about trader behaviour in a controlled setting, which may be augmented by information obtained from traders through questionnaires. Third, the markets engage traders to follow the political process more carefully. And fourth, the markets teach participants about financial markets and trading strategies such as "long" and "short" positions. Because of the educational aspects of the Sauder School of Business Prediction Markets, we particularly encourage participation from students at high schools (under supervision of their teachers) and universities. The Sauder School of Business Prediction Markets is open to all who have an interest in Canadian politics and current events.
Why do traders in the Sauder School of Business Prediction Markets need to invest real money; wouldn't "play money" accomplish the same objective?
     We believe that real money is important — there is a branch of economics now that studies behaviour in a laboratory setting (like psychologists have been doing for decades) and it is believed that if you want to understand market activity in a lab you need to recreate the incentives of the market which includes financial rewards. Many prediction markets have been run with "play money" and the results are generally disappointing from the perspective of getting your participants to focus on the task at hand and care about the outcome — the way they would care in real markets, for example.
Does the market further the involvement of participants in the political process?
     We think that prediction markets are complementary to the political process because the markets make participants pay more attention to the political events, such as elections. As investors are challenged to put their money where there mouths are, they need to take the election process very seriously by paying attention and analyzing events carefully.
Does UBC make money from the Sauder School of Business Prediction Markets?
    No. The Sauder School of Business makes no money from this market at all -- the total money invested is paid back out (to the penny). There are no commissions, trading fees, or surcharges of any kind. But of course, individual investors will lose or gain money through their trading activity.
How successful are the Sauder School of Business Prediction Markets?
    Based on the results from the UBC Election Stock Market (our predecessor) for several federal and provincial elections in Canada, the markets deliver predictions of popular vote shares that are often more accurate than public opinion polls. Our markets are also one of the few sources of predicting the distribution of seats in the federal and provincial parliaments.
How can I profit from trading in the Sauder School of Business Prediction Markets?
    Traders typically "buy low and sell high" to make profits. Contracts in the Sauder School of Business Prediction Markets reflect expected election outcomes. Thus, if a trader finds that a contract is currently undervalued, buying this "cheap" contract may turn out to be profitable if the price of this contract increases over time, or if the ultimate payout of the contract as determined by the election outcome is higher than the purchase price. Holding contracts in anticipation of an increase in price is known as taking a "long position". Traders can also profit when they see a contract that appears "overvalued". In this case they take a "short position". Traders can profit from buying a $1 unit portfolio of all contracts in a given market and selling the overvalued contract. The details of the long and short strategies are described in the user guide.