A study verifying the simulation of market trading with Dynamic Pari-Mutuel mechanism using Python

Wagering is common in various arenas that include but not limited to horse racing, casinos, financial markets and stock trading. Several market mechanisms are used in these markets to predict the outcome based on the available information and make an educated decision in an investment involving huge risks. One such market mechanism is the Dynamic Pari-Mutuel market mechanism developed by Pennock. In this study I describe a python based implementation of the mathematical models used in Dynamic Pari-Mutuel mechanism. The simulation that simulates the market transactions is then validated by verifying if the price generated for each purchase transaction follows a random walk path. This work would be a gate-way leading to opportunities to study various complicated market scenarios by extending the existing capabilities of the simulation.

Name thesis:degree_name

M.S.

Level thesis:degree_level

Thesis

Discipline thesis:degree_discipline

Industrial Engineering

Grantor

University of Illinois at Urbana-Champaign

Year dc:date

2014

Author dc:creator

• Ramasamy Loganathan, Venkatesh

Contributors dc:contributor

• Sreenivas, Ramavarapu S.

• Wagering
• Dynamic Pari-Mutuel Mechanism
• Random Walk Path

Statement dc:rights

• Copyright 2014 Venkatesh Ramasamy Loganathan

Language dc:language

en

Handle dc:identifier

http://hdl.handle.net/2142/49668

OAI identifier oai:identifier

oai:www.ideals.illinois.edu:2142/49668