To what extent can new web-based technology improve forecasts? Assessing the economic value of information derived from Virtual Globes and its rate of diffusion in a financial market
To what extent can new web-based technology improve forecasts? Assessing the economic value of information derived from Virtual Globes and its rate of diffusion in a financial market
As the rate of information availability increases, the ability to use web-based technology to improve forecasting becomes increasingly important. We examine Virtual Globe technology and show how the arrival of unprecedented types of web-based information enhances the ability to forecast and can lead to significant, measurable economic benefits. Specifically, we use market prices in a betting market over an eighteen-year period to examine how new elevation data from Virtual Globes (VG) enabled improved forecasting decisions and we explore how this information diffused through the betting market. The results demonstrate how short-lived, profitable opportunities arise from the arrival of novel information, and the speed at which markets adapt over time to account fully for new data.
226-239
Green, L.
8a6dca59-b825-4959-89cc-76569eb7dd01
Sung, M.
2114f823-bc7f-4306-a775-67aee413aa03
Ma, T.
1f591849-f17c-4209-9f42-e6587b499bae
Johnson, J.E.V.
6d9f1a51-38a8-4011-a792-bfc82040fac4
October 2019
Green, L.
8a6dca59-b825-4959-89cc-76569eb7dd01
Sung, M.
2114f823-bc7f-4306-a775-67aee413aa03
Ma, T.
1f591849-f17c-4209-9f42-e6587b499bae
Johnson, J.E.V.
6d9f1a51-38a8-4011-a792-bfc82040fac4
Green, L., Sung, M., Ma, T. and Johnson, J.E.V.
(2019)
To what extent can new web-based technology improve forecasts? Assessing the economic value of information derived from Virtual Globes and its rate of diffusion in a financial market.
European Journal of Operational Research, 278 (1), .
(doi:10.1016/j.ejor.2019.04.014).
Abstract
As the rate of information availability increases, the ability to use web-based technology to improve forecasting becomes increasingly important. We examine Virtual Globe technology and show how the arrival of unprecedented types of web-based information enhances the ability to forecast and can lead to significant, measurable economic benefits. Specifically, we use market prices in a betting market over an eighteen-year period to examine how new elevation data from Virtual Globes (VG) enabled improved forecasting decisions and we explore how this information diffused through the betting market. The results demonstrate how short-lived, profitable opportunities arise from the arrival of novel information, and the speed at which markets adapt over time to account fully for new data.
Text
1-s2.0-S0377221719303340-accepted manuscript 20190411
- Accepted Manuscript
More information
Accepted/In Press date: 11 April 2019
e-pub ahead of print date: 17 April 2019
Published date: October 2019
Identifiers
Local EPrints ID: 430290
URI: http://eprints.soton.ac.uk/id/eprint/430290
ISSN: 0377-2217
PURE UUID: 40d92662-0409-4277-99b4-94341498dc2b
Catalogue record
Date deposited: 25 Apr 2019 16:30
Last modified: 16 Mar 2024 07:48
Export record
Altmetrics
Contributors
Author:
L. Green
Author:
J.E.V. Johnson
Download statistics
Downloads from ePrints over the past year. Other digital versions may also be available to download e.g. from the publisher's website.
View more statistics
