Carl's dashboard

Unfortunately we have had some delays in getting interest credited to members accounts. I apologise for any inconvenience this may be causing.

We'll do our best to get your interest credited as soon as we can.

Thanks for your enquiry. This contract was expired correctly in line with our contract rules.

Our contract rules state that the final GDP figures will be used for expiry, and not the advance or preliminary numbers. The final figures for Q4 2007 were released on March 27th of this year, as detailed on the BEA release schedule:

http://www.bea.gov/newsreleases/news_...

The figures released on this day detailed a 0.6% increase in GDP and so the US.GDP.2007Q4.NEGATIVE contract was expired at 0. Table 1.1.1. Percent Change From Preceding Period in Real Gross Domestic Product, which is used as the official source of expiry information showed a 0.6% increase after this release. The full release can be viewed here:

http://www.bea.gov/newsreleases/natio...

It clearly states that "Real gross domestic product -- the output of goods and services produced by labor and property located in the United States -- increased at an annual rate of 0.6 percent in the fourth quarter of 2007, according to final estimates released by the Bureau of Economic Analysis.".

The final figures have since been revised further and Table 1.1.1. updated to show a GDP figure of -0.2%. However, the contract was expired based on the final GDP figures provided by the BEA at the time - in line with the contract rules. Advance or preliminary figures were not used for expiry.

Because the final figure as published by the BEA was used for expiry, as per the contract rules, the original contract expiry will not be adjusted.

Thats absolutely right Anthony. The initial trade on any listed contract requires a buyer and a short-seller. And the price of this initial trade will be set by those traders - not by Intrade.

Sorry, I should have explained this better Anthony.

The exchange requires short selling - the selling of contracts without actually having to won them first. If you think the contract proposition will not happen then you sell the contract to trade into a negative position.

As an example, lets use the contract for Obama to become president...

Trader A thinks he will be president and so looks to buy 20 contracts. Trader B thinks Obama won't become president and so sells those 20 contracts to Trader A. Trader A now has a position of +20 and Trader B has a position of -20.

Trader B has sold the contracts even though he does not own them, and they can be baught back at a later time of his choosing or when the contract is expired. By trading into a negative, or "short", position then he has taken the ossposite side of the contract proposition - that Obama will not win the presidency.

There is always a balance between the number of negative positions and the number of short positions. For example...

Trader B may decide to reduce his exposure and buy back 15 contracts. He does this by matching a sell order from Trader C. So now Trader A has +20, Trader B has -5 and Trader C has -15. Both sides are in balance.

This means that when the contract is expired the losses from one side become the profits for the other side.

When a trade takes place on the exchange there is always a buyer and a seller. The buyer thinks the contract proposition will happen and the contract will expire at 100, while the seller thinks the contract proposition will not happen and the contract will expire at 0.

So when a contract expires at 100 those who bought the contract will have a winning position, and those that sold the contract will have a losing position. The money lost by the sellers becomes the profit for the buyers (and vice-versa)

Here is a simple example to help explain this better...

One contract is sold for 55.0 ($5.50 in real terms). The buyer stands to lose $5.50 if the contract expires at 0 and will win $4.50 if the contract expires at 100 ($10.00). The seller stands to lose $4.50 if the contract expires at 100 and will win $5.50 if the contract expires at 0.

So if the seller loses then his or her loss of $4.50 becomes the $4.50 profit of the buyer, and vice-versa.

I hope this helps explain things.

Hello Aran,

Apologies for the delay in reply. The $0.10 expiry fee is charged for each contract held when that particular contract is expired. This fee is applied to winning positions only - if you lose then no expiry fee is charged.

The math in your example is slightly wrong however...

If you buy a contract on Obama winning the nomination for 95.0 then in real terms you are paying $9.50 (each contract is worth $10.00). At this price your profit will be $0.50 when the contract is expired at 100, leaving a net profit of $0.40 per contract once the expiry of $0.10 is deducted.

Currently the best price you can buy Obama's nomination contract at is 95.0. This doesn't necessarily mean that this is what buyers are willing to pay for the contract - but it is what sellers are trying to sell it for. If the buyers don't want to take this price then no trading will occur.

Hello Jonathan,

Very pleased to hear you're enjoying Intrade.

There is no single Obama vs. McCain Contract. But we do have a market for the winner of the election that has individual contracts for Obama and McCain. This can be found here:

https://www.intrade.com/jsp/intrade/t...

The chart is updated on a daily basis with the closing prices for the Obama and McCain contracts from the previous days trading. A refresh of the homepage will update the chart to the present day.

Glad to hear you're enjoying the site.

We do actually have a contract listed on the future of Robert Mugabe. This can be found under Current Events -- National Leaders -- Robert Mugabe.

Under the same category we also have markets on other national leaders, such as Ahmadinejad, al-Maliki and Chavez.

If you attempt a credit card deposit and receive a message indicating your bank is refusing to authorise the transaction then unfortunately all we can do is help you fund your account by a different method (such as check or bank wire transfer).

Unfortunately most US banks (and some non-US banks) refuse to authorise credit card transfers to Intrade as they classify us in a similar way to online poker sites.