Forecast market users lose more than sports bettors
According to a report by Citizens JMP Securities analyst Jordan Bender, the median return for forecast market users stands at −8%, worse than the average −5% for sports bettors.
Source Incrypted
The largest losses are experienced by users with small deposits — investments under $100 yield returns as low as −26.8%. Only large investors with capital above $500,000 show positive returns of approximately 2.6%.
Analysts attribute this to the significant influence of major participants who remove liquidity from retail investors, thereby reducing their profitability.
Forecast markets allow participants to place bets on various events, ranging from political outcomes to sports matches, shaping market prices based on expectations. However, research shows that large players gain an advantage due to their liquidity and ability to impact the market.
In conclusion, this market structure creates challenging conditions for most small users who suffer substantial losses, while large investors can enjoy steady profits.
This information highlights the need for caution when participating in forecast markets, especially for those with small capital, and may affect the future development of these platforms.
