steve1977 8 hours ago

Isn't the stock market a prediction market as well?

kube-system 7 hours ago | parent | next [-]

No, a stock is a share of ownership in a company.

Now yes, people bet on the derivative value of those ownership shares... but that also happens to basically every asset. If a stock is a prediction market, then so is corn, and gold, and your home.

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michaelscott 6 hours ago | parent [-]

Yes, they are. Accurate prediction is rewarded in every market, for every asset or asset class. There are adjacent order benefits (I live in my home, I eat corn, I have a say in how a company is run) but these are never divorced from the impact of prediction and prediction in aggregate is just a crowdsourced leading indicator of value; oil spikes the moment a missile hits Iran not because the 2 are explicitly linked, but because the market has predicted the effect on the flow of that oil over some subsequent timeframe and priced itself accordingly

	▲	kube-system 5 hours ago \| parent [-]
		Yes, but all of these things have underlying assets that are not themselves predictions. You can buy and sell corn commodities, but at the end of the contract, actual corn is delivered. Predictions markets are different in that they betting on the prediction itself and have no associated asset.

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foobarchu 7 hours ago | parent | prev | next [-]

The difference in my mind is that prediction markets and gambling are betting on outcomes, not long term behaviors. You could make the argument that they are the same, in the sense that buying a stock is "betting" on a company to do well, but I think you'd be making a silly argument. Stocks are intangible these days, but they were traditionally a physical thing that one would trade. If you're betting on prediction markets, there's nothing to trade after the event happens, just payouts.

	▲	SoftTalker 7 hours ago \| parent \| next [-]
		Stocks are shares of ownership. Now, in practice many people buy them as bets, but even those aren't really predictions. Prediction markets are time-boxed all-or-nothing plays. You are either correct, or you lose your entire stake.
	▲	nojito 7 hours ago \| parent \| prev [-]
		Not exactly. Kalshi is binary options. Not stocks.

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

Stocks aren't prediction markets, but options and futures are.

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wnc3141 8 hours ago | parent | prev | next [-]

I think the stocks don't have a arbiter managing a discrete outcome between parties that don't have any KYC compliance.

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ahepp 6 hours ago | parent | prev | next [-]

Couldn’t we say that any market rewards prediction? And that this is generally seen as a beneficial quality that results in more accurate valuations with better liquidity?

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rizzom5000 7 hours ago | parent | prev | next [-]

Stock prices are a prediction built on crowdsourced information.

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unethical_ban 6 hours ago | parent | prev [-]

A commenter noted that MN already bans sports-betting, which is far closer to what prediction markets are than asset trading.

A closer stock analogy would be options.