Prediction Markets: Investing, Gambling or a Haven for Insider Trading? | WSJ’s Take On the Week

In this week's episode of WSJ’s Take On the Week, co-hosts Miriam Gottfried and Telis Demos look at why the Magnificent Seven stocks—including Microsoft, Meta, and Google parent Alphabet—are losing their luster. Are investors finally demanding to see results from AI spending, or are they content with the continued AI infrastructure spending? Then, they dive into the residential real-estate cycle, where we’ve seen national rent growth hit a decade low. Could deeply discounted multifamily Real Estate Investment Trusts, or REITs, be the value play of the year? Then, Telis and Miriam confront prediction markets, which have been in the news lately for high-profile arrests of insiders accused of trading on confidential information. They are joined by former Susquehanna International Group trader Andrew Courtney, co-founder of prediction markets platform Kalshinomics, who digs into the mechanics of these zero-sum contracts, insider trading and the ongoing legal battles with the U.S. Commodity Futures Trading Commission over their classification. Courtney details how professional market makers provide the liquidity that distinguishes them from a bet against the house. And he gives his take on how investors should engage with prediction markets. Chapters: 00:00 Introduction 00:31 Big tech earnings and the not-so-magnificent seven 01:54 Where is the AI payoff? 04:20 Apartment REITs and the rental market cycle 07:25 Real estate as an investment class 08:55 Listener shoutout on airlines 09:54 What are prediction markets 10:51 How prediction market contracts work 12:21 Who is trading in prediction markets 15:00 How to use prediction markets as an investor 19:36 Are prediction markets truth machines? 22:13 Why prediction markets matter This is WSJ’s Take On the Week where co-hosts Telis Demos, Heard on the Street’s banking and money columnist, and Miriam Gottfried, WSJ’s investing and wealth management reporter, cut through the noise and dive into markets, the economy and finance—the big trades, key players and business news ahead. Have an idea for a future guest or episode? How can we better help you take on the week? We’d love to hear from you. Email the show at [email protected]. #WSJ #PredictionMarkets #Magnificent7