CONTACT: GEORGE MCCRORY
100 Old Public Library
Iowa City IA 52242
(319) 384-0012; fax (319) 384-0024
Release: Oct. 28, 1999
Gore, Bush show strong support in Iowa Electronic Markets
IOWA CITY, Iowa Iowa Electronic Markets (IEM)
traders favor Republican George W. Bush and Democrat Al Gore as future presidential
nominees, but the prospects for their challengers have been increasing.
In the Democratic Convention Market, Bill Bradleys
price has increased from 25 cents on Sept. 1 to 38 cents as of today (Thursday,
Oct. 28). This 38-cent price indicates that IEM traders believe Bradley has
a 38 percent chance of winning the Democratic nomination for president.
Gore still holds strong favor with IEM traders, although
his contracts have slipped from a high of 75 cents on Sept. 3 to 62 cents
today. The IEM is a real-money political futures market at http://www.biz.uiowa.edu/iem
run by professors in the University of Iowa Henry B. Tippie College of Business.
"IEM traders saw little news in last nights
debate (between Gore and Bradley)," said UI Professor Joyce Berg, one
of the IEM directors. "Although individual traders changed their positions,
the market consensus did not change. IEM prices indicate that our traders
believe that Gore is almost twice as likely as Bradley to win the nomination."
In the Republican Convention Market, prices for Bush
have remained mostly unchanged in October at 74 cents, after retreating from
an 80-cent high on Sept. 27. The most movement in the IEM Republican market
has been seen in the rest-of-field contract, which includes John McCain, Gary
Bauer, and other Republican contenders. The rest-of-field contract has nearly
doubled in price, up from 12 cents on Sept. 26 to 24 cents today.
Shares for Steve Forbes have remained flat over the
last two months, trading at about 5 cents. Even before her Oct. 20 announcement
to drop out of the race, presidential aspirant Elizabeth Doles shares
were at only 2 cents, dropping to one-tenth of a cent on the news.
The IEM also conducts markets based on the two Houses
of Congress and New York Senate race, in which New York City Mayor Rudolf
Giulianis contract is trading at 57 cents, while First Lady Hillary
Clintons contract is at 35 cents.
Since the New York Senate and presidential nomination
markets opened in June, the IEM has attracted almost 3,500 trader accounts
with a total equity of about $70,000; more traders are expected to log on
as the election season continues.
Started in 1988 at the UI, the IEM was developed as
a way to teach students about commodities futures markets and permit detailed
studies of how those markets operate. The Iowa Electronic Markets traders
buy or sell contracts shares in candidates for political office. Winning contracts
pay $1; losing contracts pay nothing. For an investment of as little as $5
or as much as $500, IEM traders can participate in these markets.
The IEM has forecasted election results with great
accuracy, tracking the vote shares in the last three presidential elections
within an average of 1 percent.
For more information, contact IEM operations office
at (319) 335-0794. Detailed trading information can be found in the IEM website