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The Hollywood Stock Exchange, or HSX, is a web-based, multiplayer
game A game is a structured type of play usually undertaken for entertainment or fun, and sometimes used as an educational tool. Many games are also considered to be work (such as professional players of spectator sports or video games) or art ...
in which players use simulated
money Money is any item or verifiable record that is generally accepted as payment for goods and services and repayment of debts, such as taxes, in a particular country or socio-economic context. The primary functions which distinguish money are: m ...
to buy and sell "shares" of actors, directors, upcoming
film A film, also known as a movie or motion picture, is a work of visual art that simulates experiences and otherwise communicates ideas, stories, perceptions, emotions, or atmosphere through the use of moving images that are generally, sinc ...
s, and film-related options. The game uses Virtual Specialist technology invented by HSX co-founders and creators Max Keiser and Michael R. Burns, who were awarded a in 1999 for the invention. Claims of this patent cover trading applications for trading virtual securities using virtual currencies over a network. The company moved into the former Ritts Furniture building designed by Harry Harrison on
Santa Monica Boulevard Santa Monica Boulevard is a major west–east thoroughfare in Los Angeles County, California, United States. It runs from Ocean Avenue in Santa Monica near the Pacific Ocean to Sunset Boulevard at Sunset Junction in Los Angeles. It passes t ...
.


Operation

Because trading directly affects the prices of the securities – purchasing enough shares of a stock causes its price to rise, and selling causes its price to fall – and because the ultimate value of a moviestock is based on the film's box office, stock prices act as
box office A box office or ticket office is a place where ticket (admission), tickets are sold to the public for admission to an event. Patrons may perform the transaction at a countertop, through a hole in a wall or window, or at a Wicket gate, wicket. ...
predictions. For example, if a particular moviestock trades at "H$40.00", the market is predicting that the movie will gross US$40 million at the box office in the first four weekends of wide release. In 2007, players in the Hollywood Stock Exchange correctly predicted 32 of the 39 major-category
Oscar Oscar, OSCAR, or The Oscar may refer to: People and fictional and mythical characters * Oscar (given name), including lists of people and fictional characters named Oscar, Óscar or Oskar * Oscar (footballer, born 1954), Brazilian footballer ...
nominees and seven out of eight top-category winners. The Hollywood Stock Exchange is considered a good example of a
prediction market Prediction markets, also known as betting markets, information markets, decision markets, idea futures or event derivatives, are open markets that enable the prediction of specific outcomes using financial incentives. They are exchange-traded mar ...
. Previous incarnations of the game included a
music Music is the arrangement of sound to create some combination of Musical form, form, harmony, melody, rhythm, or otherwise Musical expression, expressive content. Music is generally agreed to be a cultural universal that is present in all hum ...
market (for purchasing musical artists), prizes for top gainers and, briefly, a "buyout" program in which HSX would reward top players by purchasing their portfolios at a price of US$1.00 per HS1 million if the player listed the portfolio for sale on
eBay eBay Inc. ( , often stylized as ebay) is an American multinational e-commerce company based in San Jose, California, that allows users to buy or view items via retail sales through online marketplaces and websites in 190 markets worldwide. ...
. These features have been discontinued. The practice of selling portfolios on eBay was inaugurated by Curtis Edmonds, a former Texan lawyer. HSX attracted some private investment during the
dot-com boom The dot-com bubble (or dot-com boom) was a stock market bubble that ballooned during the late-1990s and peaked on Friday, March 10, 2000. This period of market growth coincided with the widespread adoption of the World Wide Web and the Intern ...
and ran TV ads on cable channels in an effort to attract players. After the dot-com crash, HSX was eventually acquired by units of Cantor Fitzgerald. Cantor has used HSX's moviestock prices to assist Cantor's
gambling Gambling (also known as betting or gaming) is the wagering of something of Value (economics), value ("the stakes") on a Event (probability theory), random event with the intent of winning something else of value, where instances of strategy (ga ...
operations in the
United Kingdom The United Kingdom of Great Britain and Northern Ireland, commonly known as the United Kingdom (UK) or Britain, is a country in Northwestern Europe, off the coast of European mainland, the continental mainland. It comprises England, Scotlan ...
, in which bettors can place bets on how much money US films will gross. HSX is headquartered in
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,
California California () is a U.S. state, state in the Western United States that lies on the West Coast of the United States, Pacific Coast. It borders Oregon to the north, Nevada and Arizona to the east, and shares Mexico–United States border, an ...
.


Special warrants

During the holidays, there were "holiday warrants" that allowed one to predict the final gross of a movie by President's Day weekend of the following year. For example, there was a '' Narnia'' warrant of H$180 million. Since ''Narnia'' would make over US$300 million by February 20, 2006, anyone who purchased the warrant made over H$120 per share. On the other hand, '' Zathura'' had a holiday warrant for H$70 million. Since ''Zathura'' closed a month after its release and made less than U$30 million, anyone who predicted that it would make more than US$70 million lost their investment. During the summer, there were similar "Blockbuster Warrants" that allowed one to predict the final gross of a movie by Labor Day weekend of that year. Currently, Blockbuster Warrants are issued throughout the year for those movies that will gross $100 Million or more through their first 12 weekends of release. Every winter there are special warrants to predict the
Oscar Oscar, OSCAR, or The Oscar may refer to: People and fictional and mythical characters * Oscar (given name), including lists of people and fictional characters named Oscar, Óscar or Oskar * Oscar (footballer, born 1954), Brazilian footballer ...
nominees called "Nominoptions" followed by Award Options to predict the actual
Academy Award The Academy Awards, commonly known as the Oscars, are awards for artistic and technical merit in film. They are presented annually by the Academy of Motion Picture Arts and Sciences (AMPAS) in the United States in recognition of excellence ...
winners. There are special warrants for first year scripted TV shows based upon the number of episodes that will be shown by May 31, the end of the TV Season. HSX also releases various special derivatives throughout the year. During the summer of 2006, there were derivatives for the
FIFA World Cup The FIFA World Cup, often called the World Cup, is an international association football competition among the senior List of men's national association football teams, men's national teams of the members of the FIFA, Fédération Internatio ...
. Other past special warrants involved the contestants on ''
Survivor Survivor(s) may refer to: * one who survives Arts, entertainment and media Fictional entities * Survivors, characters in the 1997 KKnD series#Armies, ''KKnD'' video-game series * ''The Survivors'', or the ''New Survivors Foundation'', a fictional ...
'', ''
American Idol ''American Idol'' is an American Music competition, singing competition television series created by Simon Fuller, produced by Fremantle (company), Fremantle North America and 19 Entertainment, and distributed by Fremantle North America. It a ...
'' and top categories of the
Grammy Awards The Grammy Awards, stylized as GRAMMY, and often referred to as The Grammys, are awards presented by The Recording Academy of the United States to recognize outstanding achievements in music. They are regarded by many as the most prestigious a ...
.


See also

* Cantor Exchange * The simExchange


References

{{reflist, 1


External links


Hollywood Stock Exchange

International Herald Tribune article 27 November 2005
Prediction markets Browser games Multiplayer online games