Calculate weights, probs, and payoffs

market-simulator/src/components/Simulator.vue

@@ -6,17 +6,23 @@
           <th>Order #</th>
           <th>Yes bid</th>
           <th>No Bid</th>
+          <th>Yes Weight</th>
+          <th>No Weight</th>
           <th>Implied Probability</th>
-          <th>Payout</th>
+          <th>Yes Payout</th>
+          <th>No Payout</th>
         </tr>
       </thead>
       <tbody>
         <tr v-for="(entry, i) in entries">
-          <th>{{ i }}</th>
+          <th>{{ i + 1 }}</th>
           <td>{{ entry.yesBid || '' }}</td>
           <td>{{ entry.noBid || '' }}</td>
+          <td>{{ entry.yesWeight || '' }}</td>
+          <td>{{ entry.noWeight || '' }}</td>
           <td>{{ entry.prob }}</td>
-          <td>{{ entry.payout }}</td>
+          <td>{{ entry.yesPayout }}</td>
+          <td>{{ entry.noPayout }}</td>
         </tr>
       </tbody>
     </table>
@@ -26,9 +32,41 @@
 <script setup lang="ts">
 import { bids } from './orders'
 
-const entries = bids.map((bid) => ({
+const entries = [] as any
-  ...bid,
+const YES_SEED = 1
-  prob: 0.646,
+const NO_SEED = 9
-  payout: 1.23,
+let yesPot = 0
-}))
+let noPot = 0
+let yesWeightSum = 0
+let noWeightSum = 0
+for (const bid of bids) {
+  const { yesBid, noBid } = bid
+  const yesWeight = noPot * (Math.log(yesBid + yesPot) - Math.log(yesPot)) || 0
+  const noWeight = yesPot * (Math.log(noBid + noPot) - Math.log(noPot)) || 0
+
+  // Note: Need to calculate weights BEFORE updating pot
+  yesPot += yesBid
+  noPot += noBid
+  const prob = yesPot / (yesPot + noPot)
+
+  // Payout: You get your initial bid back, as well as your share of the
+  // (noPot - seed) according to your yesWeight
+  yesWeightSum += yesWeight
+  noWeightSum += noWeight
+  // This only represents the payout if the market were to close immediately.
+  // TODO: use refs to reactively update the payout
+  const yesPayout = yesBid + (yesWeight / yesWeightSum) * (noPot - NO_SEED)
+  const noPayout = noBid + (noWeight / noWeightSum) * (yesPot - YES_SEED)
+
+  entries.push({
+    yesBid,
+    noBid,
+    // Show two decimal places
+    yesWeight: yesWeight.toFixed(2),
+    noWeight: noWeight.toFixed(2),
+    prob: prob.toFixed(2),
+    yesPayout: yesPayout.toFixed(2),
+    noPayout: noPayout.toFixed(2),
+  })
+}
 </script>

market-simulator/src/components/orders.ts

@@ -43,8 +43,7 @@ const data = `1,9
 10,
 ,10
 10,
-,10
+,10`
-`
 
 // Parse data into Yes/No orders
 // E.g. `8,\n,1\n1,` =>