I got into weather betting markets earlier this year since I figured those can't possibly be rigged, it is automated weather station data yet some groups in the market know the truth a few minutes before everyone else based on the way the markets move.

BUT, I stopped on the day that the PHL airport preliminary report said the low of the day was 17 and then later than day the low was raised to 18. The way the market was behaving, insiders knew the low would be retracted because normally the markets clear out a tranche of bets that are no longer possible and that wasn't happening that day.

So I don't do that. The whole game seems to be based on a group of insiders that know when and what temperature reports will say seconds or minutes before the general public and they have the capacity to play with validation on the back-end (I suspect).

I built a few models to predict weather 6+ hours out using blended model forecast data, but that didn't do better than break-even.

I don't know my point. It is the wild west, caveat emptor, you need thick skin and ridiculous attention to detail to beat the game, and even then the deck is probably stacked against you.

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pixl97 4 hours ago | parent | next [-]

The high speed traders win, and you're not part of the club.

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learn_more 4 hours ago | parent | prev | next [-]

it seems this could be solved by refusing last minute bets?

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hermannj314 4 hours ago | parent [-]

Data is released every minute, every five minutes, every hour, and then 6 hour high/low, and then mid-day preliminary reports, so there is no last-minute since any one of those reports could contain data (with various validation/rounding caveats) that could eliminate a market of temperatures, so there isn't really a last minute.

My conclusion was to focus on forecast and attempt to predict the temperature better than forecast vs. market implied probability rather than attempt to respond very quickly to published information. I learned (with my skills) the latter was a losing proposition, but the former isn't impossible (although also possibly beyond my skills it seems).

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TheCowboy an hour ago | parent [-]

A lot of people assume insider trading in weather markets on data that's publicly available but they're unaware of.

It's also a massive whoosh that you only consider the insider trader aspect in choosing to play weather markets. No consideration of how you would get an edge in these markets against extremely powerful weather models used by meteorologists who understand the subject and how to apply the data. It seems much different than betting against political pundits.

It's also another whoosh not realizing that some of these stations are actually not that secure when you take a look at them in real life. Less insiders than betting on things that aren't tamper-resistant.

Also, a lot of people complain about insiders profiting from last minute data. One way to limit this would be requiring markets to close in advance of final data, but people love to gamble (read: bet without an edge) on things at the last minute across all prediction market subjects.

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themafia 4 hours ago | parent | prev [-]

> said the low of the day was 17

People are gambling on the "low of the day?"

Might as well make back alley chicken fighting legal.

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hermannj314 4 hours ago | parent [-]

I'm not going to lie, it started as a fun thing to do on a boring and cold Saturday night after a snow storm, I was looking at weather underground map of stations around central park praying it would drop a few degrees and I'd make 4:1 on my bet. I learned a lot about weather stations in the next few weeks and it was cool looking the historical data from the Central Park weather station (I think the longest running in the US) and see how it added features and new reporting values over its long 100+ year life. It was a fun winter side quest.

I don't think this needs regulated if the people involved are responsible and having fun. No chickens died for sure, which is probably why these articles focus on the more serious bets where people are dying (and not weather).

	▲	dugidugout 3 hours ago \| parent \| next [-]
		I sure enjoyed reading your account of the experience! Thank you!
	▲	themafia 3 hours ago \| parent \| prev [-]
		> if the people involved are responsible and having fun. I think "please gamble responsibly" has the same power as "please drink responsibly." Which is to say, we regulate the ever loving hell out of alcohol sales, and that's probably where gambling should be headed as well.