Will Hubdub introduce margin trading?

What will be the point in this? If you have nothing to risk, then people would have no problem borrowing money. I have never went "bankrupt" so I don't know what happens at that point, but if I was able to take money with ZERO downside of course I will.

The point would be to add another dimension to the game and introduce more elements that exist in real markets. It would give newer players the opportunity to use leverage to work their way up the rankings faster. The H$ borrowed are secured against your existing positions and you would be required to maintain whatever the stipulated LVR is and of course pay interest or have to liquidate those positions to do so.

Pete I like the idea in theory and use, but this site is wrong application. In real life you would have to to cover any position that goes against you. In this game, the player would have no risk. Let's say the leverage is 40x and you have 1000$ so now you have 40,000$ to play with. If you lose you only go to $0. And how would you calculate interest? Let's say I want to bet on a sports game, I can bet and use my leverage up to the game begins. Is there a way to calculate interest by minutes?? Yes, but that is beyond the scope of the game. So what this would essentially do is penalize those who want to wager on predictions that take a long time to have a result (such as "Will the Dow be below 6000 by December 31st" vs. Will the Jets win against the Broncos today") The only way for this truly to work is have the USER as the lender and they can loan at the rate they want, and HubDub will cease to supply funds. Once a user goes bankrupt he will have to request a loan from the "cashed up" player. What do you think of that??

Good comments. I agree really high leverage would distort the market as it has in the real world. Don't know exactly how it would work but I'm hoping some bright spark comes up with a system that's perfect for Hubdub. Then maybe the real financial world can copy it and everyone can climb out of the hole we're in. I think the game works great as it is and the only reason for introducing something like this is if it increases the fun or functionality.

Oh, goodie! It sounds like a real-life economy game, just like we have today! You can lose your home to Fannie and Freddie (your computer which you pledged for additional hubdub funds), AND hubdub can go belly up and get a bail-out from Heehee--HAHAHAHAH--whoaHOHOHO-hahaha...Sorry, I'm laughing too hard to tell you where the money is going to come from....HAHAHAHA...

My apologies for being so rude...

Sorry Randburg but you're way over my head. But then..it is my birthday and I'm a bit drunk...

this can't work.

Isn't this what got Citibank, Morgan Stanley, Lehman Bors....you know all those wall street firms we are now bailing out in trouble to start with; little thing called deregulation and er umm...greed.

#4 said: "I'm hoping some bright spark comes up with a system that's perfect for Hubdub."

I suggested margin betting about three (?) months ago, on the earlier version of Hubdub's suggestion board, but now I've had a better idea: Pay interest on long-term bets. This would have the following advantages over margin trading:

1. Simpler for Hubdub to compute (once a day, at midnight), and simpler for users to understand. (No action on their part would be needed.)
2. Low “support costs.” I.e., lower potential for complaints, questions, misunderstandings, and grief.
3. Increased participation in long-term bets, which often languish, and yet which are the ones where the prescient can truly shine.

Bettors would be paid interest on all bets whose suspension date is (say) eight weeks or more away--and the more distant the suspension date, the greater the payoff. Here's a one-bet example. Let's say you've placed a $100 bet on a question whose expiration date is 52 weeks away. There are thus 44 weeks that are eligible for interest payments, assuming the interest payments are computed daily, in order to closely track users' varying commitments over time. At the end of the first day, the number of eligible weeks would be multiplied by the daily interest rate. Let's say it's .0001%. Thus the daily payout would be:

44 * .0001 * $100 = $.44 (44 cents).

If he holds the bet until suspension, he'd receive $.44 daily * (7 * 44) days, or .44 * 308 days, or $135.52. (This amount could be raised or lowered by raising or lowering the interest rate.) In effect, the long-term bettor would be getting more money to bet with on other items, the same as with margin.

Oops: My calculation in the last paragraph failed to take account for the daily decline in the number of days remaining in the bet! So the bettor would get only about half of that $135.72, or roughly $68. (If that's too low an inducement, raise the interest rate.)

people have raised the issue that in real life you would be taking the risk of going bankrupt whereas on hubdub there would be no risk. how about if you're balance goes below zero, you have to wait until you have earnt enough daily $20 until you are back in the black - that would be a fiar punishment for those wanting to take a loan to bet with.
Also on the subject of the daily $20 - how about your daily logging on fee being a percentage of net worth - more like real life?