This transcript was generated from the episode audio and may contain minor errors.
[Music]
Hey, guess what? Welcome to a new month. It is now the month of November, 2023, episode 2,496. In just four days, we're gonna hit 2,500 episodes of Side Hustle School. Thank you so much for being out there.
Thank you for being part of the community. Many listeners, of course, have been with us for years. I am so honored. I just went on a big book tour. I went to about 15 cities in August, September, some parts of October, briefly.
And I met so many people who've been listening for a long time or have just recently discovered the podcast. However, you fed it to the timeline. Thanks for being out there excited for the next two months of the year and much more to come. So let's see here, what do we got today? Well, if you are the kind of person who's always correctly calling the outcome of political elections or other notable events, could be world events, could be events in popular culture, today's episode might be for you, might give you an idea.
We're gonna look at the world of prediction markets. This is a relatively new arena that could allow you to monetize your forecasting talents. In fact, lots of people are doing this. I wrote a whole chapter in Gonzo Capitalism about prediction markets. And so we're gonna hear from a listener who's wondering some specifics.
I'll see if I can give him some tips and maybe somebody else out there. Thanks for being around. A quick action-packed episode, hopefully a helpful answer for our caller, all coming up after the quick break. [Music]
Hi there, I'm Rishi from Chicago. While doing some research on alternative investment strategies, I stumbled upon your podcast and got hooked.
I've been seeing a lot about prediction markets as tools for both investment and forecasting future events. Given that it's not as straightforward as stock trading, what tips would you give a beginner like me? [Music]
Well, I really had a good time exploring all these different projects and experiments for Gonzo Capitalism. If you've read the book already, then you know I spent almost two years doing all these different experiments several months with each one typically and with prediction markets, in particular, I really enjoyed them. I also enjoyed the video games.
I got another question coming up in a couple of weeks about blockchain video games, so we'll talk about that later. But prediction markets, they are essentially betting platforms where people can predict the outcome of events, ranging from elections to the price of different currencies to popular culture events, new albums from rappers and so on, and you can get paid for this, or at least you're betting, right? So as long as there's somebody taking the other side of the bet, then one person's gonna be a winner and one will be a loser, just like any kind of betting or stock trading or anything else. So I guess the first tip is to start small. Don't put all your investment money into this, but it is fun or can be fun for some people to put a small amount of money in and kind of learn how it works.
And by experimenting, you're gonna learn just by doing some of it. You'll learn kind of how the knowledge sharing works. You'll learn how the markets are settled and such. And then over time, most likely you're gonna want to specialize and figure out, okay, where can you have an edge? And that could be on the politics side.
It could be more of an arbitrage side, or you can just tell when certain bets are off-sized, like, okay, this particular event may occur, but the odds of it occurring are not as high as people seem to think. So I'm gonna take the other side of the bet and wait for those odds to go down. I wrote a lot about this in the book if you really want to get into it. Swing trading is a big thing where you're just kind of betting on market swings. You know, if you look at political elections, like the political primary right now for the Republican primary in the United States, you know, there's various markets that are going up and down all the time.
And so you can make some money just by, whenever the odds go far in one direction, taking the other side of the bet for a couple of weeks. So check out "Predict It." Check out "CallShe," K-A-L-S-H-I, either .com or .org, I forget exactly. And just, of course, you know, understand the risks involved. Prediction markets aren't as risky as like futures markets or options trading, but it is betting. And it is possible to lose your entire investment if you're not careful.
So do your own research, but I do think it's fun to kind of play around with. So the best thing to do is to start experimenting. Rishi, anybody else out there, good luck. Let me know how it goes. If you've got questions, feedback, side of social.com/questions.
I am 193 countries on Instagram. And of course, new episode comes out every day. My name's Chris Guillebeau. This is "Side Hustle School." [Music]
- From the "Onward Project."
