Saturday, April 17, 2010

Hollywood stock exchange to become reality?

A year and a half ago, we wrote an article, Forecasting Hollywood movie box office revenue with HSX trading history, based on a talk by Natasha Foutz at the 2008 INFORMS Conference in Washington, DC.

Today I see in the news (Movie futures market approved) that trading of futures related to movies' box office success is about to become a reality. There may be some legal and political obstacles left to surmount, but there may yet be more data to work with in this line of research.

Curiously the article focuses on financial aspects of the new financial instruments rather than the consequences for Operations Research. Market liquidity and hedging by large and independent film financiers is a laudable goal, but think of the statistics!

I would be interested to know what sort of use movie theatres/cinemas could make of these predictions when making operational and strategic decisions regarding film selection and scheduling.

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