Sunday, November 23, 2003

New York Times Article on HSX - Hollywood Stock Exchange

I used to play this a great deal - I think it is a year since I have checked my money. Hey, It's H$158,384,873.21.

Studios, along with academics, are interested in it as a way to predict which movies will succeed. Traders are working to turn the concept into an actual financial market, like those for futures in corn, oil and other commodities. It has also served as the model for a television show merging trading and music.

All this interest revolves around a fantasy game that allows online players to trade "securities" whose prices forecast the first four weeks of box office revenue for new and yet-to-be-released films. Late last week, traders could "buy" stock in "The Cat in the Hat" (released on Friday), at $130 a share, meaning that the market expected four-week box office receipts of $130 million. Or they could buy "Spider-Man 2," due for release next May, at $235 a share, or even "Spider-Man 3," which has not yet been made and won't be released for years, at $87.

The exchange's appeal lies in the premise that the collective wisdom of large numbers of traders can most efficiently determine the value of properties that would otherwise be hard to assess.

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