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The simple reason you can't manipulate the market for profit is that everyone else can make the same bet you are making, quickly reducing the profit since you have the added expense of manipulating the market.

If a person can manipulate the market without expense, then they can do it without relying on the profit and the market isn't the problem. It will, however, allow them to bet on the market, providing a good indicator.



Imagine that there's a market for which day a politician will die on. Initially, all of these daily contracts are priced very low because there is a very low chance of a politician dying on any given day. So, you buy quite a few of one particular day, and then go kill the politician.


Then you either: - Collect your money and be arrested and sent to jail for murder - Evade capture but never collect your money.

How does this work, again?


Don't know why you're getting downvoted. The comments here are about as sophisticated as "Short Tesla and kill Elon. Stock markets are broken QED".


Seems like the politician would know precisely when to stay home.




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